Deere Momentum Stalling In Fields

Commodities & Metals

Published: August 18, 2010 8:00 am

Last Updated: April 27, 2020 8:00 pm

Deere & Company (NYSE: DE) finds itself in a strange spot this morning. The company blew past earnings estimates with $1.44 EPS, far above the Thomson Reuters consensus of $1.21. Revenue for its fiscal third quarter was up close to 25% at $6.84 billion while net sales were $6.22 billion. Thomson Reuters had estimates of $6.49 billion.

Where things get tricky is in the guidance. Net income for Deere & Company is anticipated to be approximately $375 million in the next quarter. Estimates are closer to $388 million. Deere said that equipment sales are projected to rise about 12% for fiscal 2010 and to rise about 32% for the fourth quarter over a year ago.

The company also said that a 2% favorable impact from currency is in there for the year, but about a 1% unfavorable impact in the quarter.

One of the other issues is Deere’s price performance. At $67.23, its 52-week range is $40.28 to $69.47 and the stock was in the mid-$50’s at the peak of selling in that end of June and early July sell-off. The stock got ahead of itself. Sometimes stocks just reach a fair valuation.

Shares are lower, but they are just under $66.00.

JON C. OGG

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