PACCAR Inc. Earnings: Increased Profit Helps Beat the Street

S&P 500 (NYSE:SPY) component PACCAR Inc. (NASDAQ:PCAR) reported net income above Wall Street’s expectations for the fourth quarter. PACCAR is a technology company that designs and manufactures light, medium, and heavy duty commercial trucks and related aftermarket parts.

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PACCAR Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for PACCAR Inc. rose to $327.7 million (91 cents per share) vs. $169.8 million (46 cents per share) in the same quarter a year earlier. This marks a rise of 93% from the year earlier quarter.

Revenue: Rose 58.7% to $4.85 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: PCAR beat the mean analyst estimate of 79 cents per share. It beat the average revenue estimate of $4.23 billion.

Quoting Management: “PACCAR’s excellent balance sheet and operating cash flow of $1.59 billion in 2011 have enabled increased capital investments in new products, enhanced manufacturing efficiency and global expansion,” said Pigott. “To support the investments in global business initiatives in 2011, the company displayed its vehicles at major truck shows in the BRIC countries (Brasil, Russia, India, China) during the year. We have begun construction of a DAF assembly facility in Brasil, opened a parts distribution center in Russia and added employees in our India and China operations,” added Pigott. “We are pleased that our vehicles achieved record share in the above 15-tonne market in Europe and Class eight market in North America. It is expected that the truck market in the U.S. and Canada will further improve in 2012. Ongoing economic uncertainties in Europe have resulted in lower Eurozone industry truck orders in recent months.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 53.9%, with the biggest boost coming in the third quarter when revenue rose 67.4% from the year earlier quarter.

The company has now seen net income rise in three straight quarters. In the third quarter, net income rose more than twofold and in the second quarter, the figure rose more than twofold.

The company has now beaten estimates the last two quarters. In the third quarter, it topped expectations with net income of 77 cents versus a mean estimate of net income of 70 cents per share.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the first quarter of the next fiscal year is 77 cents per share, a drop from 78 cents. The average estimate for the fiscal year has remained at $2.73 per share.

Competitors to Watch: Navistar Intl. Corp. (NYSE:NAV), Wabash National Corp. (NYSE:WNC), Federal Signal Corporation (NYSE:FSS), Arctic Cat Inc. (NASDAQ:ACAT), Ford (NYSE:F), General Motors (NYSE:GM), Toyota (NYSE:TM), Cummins Inc. (NYSE:CMI), and Tata Motors Limited (NYSE:TTM).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com