Industrials·Farm & Heavy Construction Machinery·β 1.06Yield: Mid (1-3%)
PACCAR Inc designs, manufactures, and distributes light, medium, and heavy-duty commercial trucks in the United States, Canada, Australia, Mexico, Europe, Central and South America, and internationally. It operates through three segments: Truck, Parts, and Financial Services. The Truck segment designs, manufactures, and distributes trucks for the over-the-road and off-highway hauling of commercial and consumer goods; and diesel engine products.
Close · 3M
+4.56%
Held by 0 AI ETFs
None of the tracked AI ETFs currently hold this name.
Signal performance
Each tracked ETF's moves on this stock, grouped by fund. Returns are measured from the signal date to the latest close — hypothetical, no commissions or slippage.
The AI likely divested PCAR due to its significantly negative revenue growth, making its relatively high PER unappealing and signaling deteriorating fundamentals. This swift removal highlights how algorithms rapidly re-evaluate positions based on updated fundamental data. Retail investors should likewise prioritize strong revenue growth in their analysis, recognizing that negative growth can quickly trigger sell signals, especially when combined with elevated valuations. Always align a company's valuation with its growth prospects to avoid overpaying for underperforming assets.
weight 0.200% → 0 (exited)·stock down 1.3% in the 30 days before
May 3·entry $114.37·now $116.51
+1.87%
since May 3
Sell signals show what the stock did after the AI exited. A negative number means the AI's exit was well-timed.
Buffett-style framework
Fails the frameworkas of May 4
The AI ETF AIEQ recently completed an exit from its position in PACCAR. This action aligns with the framework's 'Fail' verdict, indicating that the AI also did not find the stock attractive enough to hold at its current valuation.
Circle of CompetencePACCAR's business in heavy-duty trucks and related services, while cyclical, has predictable unit economics that allow for reasonable long-term cash flow projections.
Economic MoatPACCAR benefits from strong brand recognition for Kenworth, Peterbilt, and DAF, scale advantages in manufacturing, and extensive dealer and service networks creating durable competitive advantages.
ManagementPACCAR has a history of disciplined capital allocation, including share repurchases and consistent dividends, which aligns with sound management practices, though candidness and skin in the game cannot be fully assessed from provided data.
Financial HealthPACCAR has demonstrated strong financial health with a 10-year average Return on Equity above 15% and no single year below 10%, along with a conservative balance sheet.
Margin of SafetyThe current price, reflected in elevated valuation multiples like PER and EV/EBITDA, does not offer a sufficient margin of safety relative to PACCAR's inherent value given its cyclical nature and recent revenue decline.
PACCAR is a high-quality business that operates within the framework's circle of competence, possessing a durable economic moat, sound management, and robust financial health. However, the current market valuation does not provide an adequate margin of safety. Consequently, the company is not considered a compelling investment at this price.
Educational interpretation generated by AI applying frameworks Warren Buffett documented in his shareholder letters and other public writings. Not a statement by Mr. Buffett or Berkshire Hathaway, and not investment advice.