Paccar stock drops 7.3% as profit plunges 91.5%

Paccar's stock fell 7.3 percent Tuesday after the Bellevue-based truck maker reported a big drop in second-quarter sales and profit and warned that European sales will remain weak.

The company said the weak economy hurt freight shipments and truck sales and contributed to its second-quarter profit plunging 91.5 percent to $26.5 million, or 7 cents a share, from $313.5 million, or 86 cents, a year ago.

Excluding a one-time tax gain, the company lost a penny a share. Wall Street analysts surveyed by Thomson Reuters expected, on average, a profit of 4 cents a share.

Paccar's revenue, from truck sales and financial services, dropped 55.1 percent, to $1.85 billion from $4.11 billion a year ago.

Jefferies analyst Stephen Volkmann called the second-quarter results "weak but no disaster." He noted that Paccar achieved good cost controls.

Also Tuesday, the company cut its 2009 estimate for European sales of trucks heavier than 15 metric tons to a range of 150,000 to 180,000, "reflecting very challenging economic conditions throughout Europe," a spokesman said.

And next year's European sales could fall to a level not seen since 1992, the spokesman added.

Paccar shares closed down $2.58 at $32.71 Tuesday after falling as low as $30.97 earlier in the day.