Zacks Investment Research downgraded shares of PACCAR Inc. (PCAR) from NEUTRAL to UNDERPERFORM on July 25, 2012, with a target price of $35.00.
Despite being the third largest manufacturer of heavy-duty trucks in the world, PACCAR faces tough competition in its principal markets -U.S., Canada and Europe. Further, the company expects industry sales in the above-16-tonne truck market in Europe will go down due to the ongoing uncertainty in Eurozone. Although the company has beaten the Zacks Consensus Estimate by a penny in the second quarter of the year, it expects sluggish growth in the U.S. and economic weakness in Europe to continue to mar its earnings growth. Therefore, we have downgraded the recommendation on the shares of the company to Underperform from Neutral and set a target price of $35.00.
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