PCAR
PACCAR Inc
$110.82
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 0.4% below fair value
You pay
$110.82
Bear
$83.38
Fair
$111.30
Bull
$137.81
Bear
$83.38
-24.8%
5% stage 1 growth, 11% discount
Fair
$111.30
+0.4%
9% stage 1 growth, 11% discount
Bull
$137.81
+24.4%
11% stage 1 growth, 11% discount
Adjust Assumptions
8.7%
11.0%
3.0%
Key Value Driver
FCF growth rate (9% base case)
Terminal Value % of EV
38%
Implied Market Multiple
19.5x
Market is pricing in (growth)
8.7%
vs 8.7% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (45 analysts)
$134.83
Divergence from AlphaVal
17%
Summary
Using a two-stage FCF DCF with 9% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $111.30 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions