July 24, 2025 a 07:31 am
PCAR: Dividend Analysis - PACCAR Inc
PACCAR Inc maintains a robust dividend history with 39 consecutive years of payouts. With a dividend yield of approximately 3.95%, the company presents a stable income opportunity for investors. However, the payout ratios indicate a relatively high distribution of earnings and cash flows, demanding cautious monitoring of its financial efficiency.
Overview 📊
The overview provides critical financial metrics pertinent to PACCAR Inc’s current dividend profile.
| Metric | Details |
|---|---|
| Sector | Industry Unknown |
| Dividend yield | 3.95% |
| Current dividend per share | 4.36 USD |
| Dividend history | 39 years |
| Last cut or suspension | None |
Dividend History 🗣️
Understanding PACCAR's longstanding dividend history is crucial. It signifies the company's commitment to returning capital to shareholders, thereby enhancing investor confidence.
The recent five dividend payments are listed below, showcasing both consistency and growth in payouts:
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 0.99 |
| 2024 | 3.87 |
| 2023 | 4.24 |
| 2022 | 2.79 |
| 2021 | 1.56 |
Dividend Growth 📈
Analyzing dividend growth is crucial for assessing future income potential. PACCAR's dividend growth over recent years suggests stable enhancements:
| Time | Growth |
|---|---|
| 3 years | 0.35% |
| 5 years | 0.10% |
The average dividend growth is 0.10% over 5 years. This denotes moderate but steady dividend growth, offering a sense of reliability.
Payout Ratio 📉
The payout ratio provides insight into the sustainability of dividends using the company's earnings and cash flows.
| Key figure | Ratio |
|---|---|
| EPS-based | 74.56% |
| Free cash flow-based | 96.80% |
The EPS payout ratio at 74.56% suggests dividends consume a significant portion of earnings. Similarly, the FCF ratio is elevated at 96.80%, indicating thin margins in cash flow coverage.
Cashflow & Capital Efficiency 💸
Insights into PACCAR's cash flow strength and capital efficiency are essential to assess long-term financial health and ability to sustain dividends.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 0.05 | 0.06 | 0.05 |
| Earnings Yield | 0.08 | 0.09 | 0.09 |
| CAPEX to Operating Cash Flow | 0.42 | 0.30 | 0.46 |
| Stock-based Compensation to Revenue | n/a | n/a | 0.00 |
| Free Cash Flow / Operating Cash Flow Ratio | 0.62 | 0.70 | 0.54 |
The cash flow metrics reveal stable capital allocation, though the free cash flow yield slightly decreases over historical data. Monitoring CAPEX levels is key to maintaining cash flow sufficiency.
Balance Sheet & Leverage Analysis 🏦
A sound balance sheet is critical for dividend sustainability and financial flexibility under economic pressures.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.91 | 0.91 | 1.23 |
| Debt-to-Assets | 0.37 | 0.35 | 0.49 |
| Debt-to-Capital | 0.48 | 0.48 | 0.55 |
| Net Debt to EBITDA | 1.52 | 1.09 | 2.28 |
| Current Ratio | 1.08 | 2.50 | 1.43 |
| Quick Ratio | 0.89 | 2.30 | 1.12 |
PACCAR's leverage metrics convey cautious utilization of debt. The company maintains liquidity, evidenced by consistent current ratios, indicating sound risk management.
Fundamental Strength & Profitability 📉
Analyzing fundamental strength gauges PACCAR's ability to generate solid returns and assure future payouts.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 0.24 | 0.29 | 0.23 |
| Return on Assets | 0.10 | 0.11 | 0.09 |
| Net Margin | 0.12 | 0.13 | 0.10 |
| EBIT Margin | 0.15 | 0.16 | 0.13 |
| R&D to Revenue | 0.015 | 0.011 | 0.012 |
Solid returns on equity and assets reflect PACCAR's proficiency in managing capital and operations, ensuring profitability to support dividend continuity.
Price Development 📈
Dividend Scoring System ✅
The dividend scoring system assesses PACCAR's competency across multiple parameters, providing an overarching dividend reliability index.
| Criteria | Score | Assessment |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 5 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 4 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 3 | |
| Balance Sheet Quality | 4 |
Total Score: 30/40
Rating 🏆
PACCAR Inc is a resilient dividend payer, offering reliable returns and stability. The company is recommended for investors prioritizing consistent income with a tolerance for moderate growth. Monitoring cash flow metrics and payout ratios is advised to ensure continued dividend support.