10
Paccar
The rush to buy trucks before the EPA’s new 2007 limits on diesel engines explains, in large part, how heavy-duty truck leader Paccar motored to a record profit in 2006 on all-time high sales. But Paccar and CEO Mark Pigott deserve credit, too. The company’s custom-built Kenworth and Peterbilt trucks are a favorite among drivers, helping it begin 2007 with a $2.7 billion backlog. But with so many new rigs on the road, analysts expect profits to slide 26% in 2007, the first reversal since 2001. Profits could rise again by 2008: With the takeover of two European truckmakers, Paccar now sells more overseas than at home—and those markets are growing.
| Overall Grade | A |
|
| Market Data | PCAR | |
| Market Value (2/28/2007) |
$17.3 Billion |
|
| Profitability* | 34.5% | A- |
| Sales Growth Rate** | 25.9% | A |
| 12-Month Sales | $16.5 Billion |
|
| 12-Month Net Income | $1.5 Billion |
|
| Total Return | Past 12 Months55.9% | Past 36 Months112.5% |
| Economic Sector | Industrials | |
| Industry | Construction & Farm Machinery & Heavy Trucks | |
The overall sector letter grade reflects how the weighted average of the return on income, or return on equity, and sales growth grades compare with others in the same sector. For the overall grade as well as the ROE/ROI and sales growth grades, an "A" places a company in the top 7% of its sector and an "A-" in the top 14% of the sector. The actual ranking was done using the underlying numerical measures. Grades are for information only.
* For nonfinancial companies, three-year average pretax operating profit before interest and special items as a percentage of average invested capital. For financial companies, pretax profits as a percentage of average shareholder's equity.
*Three-year average annual sales growth based on the most recently reported 36 months, calculated using the least-squares method.
