PACCAR Inc.: The Burden of Proof Continues to Shift to the Bears; Raising Dec 26 PT to $164

Research evidence excerpt

PACCAR Inc.: The Burden of Proof Continues to Shift to the Bears; Raising Dec 26 PT to $164

J P M O R G A N North America Equity Research

29 July 2026

PACCAR Inc. Overweight

PCAR, PCAR US

The Burden of Proof Continues to Shift to the Bears; Price (28 Jul 26):$138.21

Raising Dec 26 PT to $164 ▲Price Target (Dec-26):$164.00 Prior (Dec-26):$155.00

The bear thesis on PCAR continues to weaken; positive earnings revision

cycle ahead. PCAR shares were up ~4% (vs. SPX flattish) yesterday after posting Machinery, Engineering &

Constructiona 5% EPS beat in the quarter. Gross margin of 14.4% (vs. consensus at 13.7%) was

the standout (recall we positively previewed the potential GM rate upside ahead of Tami Zakaria, CFA AC

the print), although bears pushed back that this beat was a result of an undisclosed (1-212) 622-9888

tami.zakaria@jpmchase.com

amount of IEEPA refund benefit. Here are our latest thoughts post-print: (1)

Investor conversations should be shifting to ‘PCAR’s 2027 estimates look Raquel Betesh

(1-212) 622-1313

conservative’ from ‘PCAR is one of the few cyclical companies that won’t raquel.betesh@jpmchase.com

grow earnings next year’. What has changed since our December upgrade? CL8

Alec R McGuire

truck orders per ACT Research data are up 118% YTD. With freight rates robustly (1-212) 622-2432

coming out of a three-year recession, the strong orders are a combination of alec.mcguire@jpmorgan.com

demand improving and pre-buying ahead of the 2027 NOx regulations. The NA J.P. Morgan Securities LLC

truck build outlook has notably improved since the start of this year; ACT Research

is now forecasting NA truck build growth of 9%/10%/13%/5% in 2026/27/28/29,

Key Changes (FYE Dec)respectively, i.e., PCAR is possibly on the cusp of a multi-year upcycle. (2) 3Q