Wells Fargo Downgrades PACCAR (PCAR) to Underperform; Stock Price Rise with Fundamental Deterioration Suggests Issues

September 12, 2012 7:50 AM EDT Send to a Friend
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Price: $65.04 -0.78%

Rating Summary:
    7 Buy, 11 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 17 | Down: 38 | New: 6
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Wells Fargo downgraded PACCAR (NASDAQ: PCAR) from Market Perform to Underperform, price target range of $35-$38.

Analyst, Andrew Casey, said, "PCAR decreased its Q3 2012 production forecast, and we are decreasing our expectations. Q3 2012 global production is now expected to decrease 15-20% from Q2 2012 vs. prior expectation for a 10% decrease. Most of the incremental weakness came as a consequence of weaker
than expected U.S. and Canadian demand. PCAR (and probably other OEMs)
acknowledged it is removing more production from Q3 2012 due to persistent
weaker demand levels."

"On this and an expectation that NAFTA production remains beneath current consensus expectations through H1 2013, we are decreasing Q3 2012E to $0.60 from $0.65 (vs. consensus $0.73), 2012E to $2.96 from $3.00 (vs. consensus $3.28), and 2013E to $3.07 from $3.10 (vs. consensus $3.65)."

For an analyst ratings summary and ratings history on PACCAR click here. For more ratings news on PACCAR click here.

Shares of PACCAR closed at $41.71 yesterday.




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