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Deere (DE) closed at $410 in the latest trading session, marking a -0.79% move from the prior day. This change lagged the S&P 500's 0.16% gain on the day. Elsewhere, the Dow gained 0.25%, while the tech-heavy Nasdaq lost 0.06%.
The agricultural equipment manufacturer's stock has dropped by 8.49% in the past month, exceeding the Industrial Products sector's loss of 8.6% and lagging the S&P 500's loss of 2.7%.
Analysts and investors alike will be keeping a close eye on the performance of Deere in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $3.08, marking a 50.56% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $7.79 billion, reflecting a 25.71% fall from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $19.57 per share and a revenue of $38.87 billion, demonstrating changes of -23.61% and -13.15%, respectively, from the preceding year.
Investors should also pay attention to any latest changes in analyst estimates for Deere. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.21% lower within the past month. Right now, Deere possesses a Zacks Rank of #3 (Hold).
From a valuation perspective, Deere is currently exchanging hands at a Forward P/E ratio of 20.95. For comparison, its industry has an average Forward P/E of 17.5, which means Deere is trading at a premium to the group.
It is also worth noting that DE currently has a PEG ratio of 1.75. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Manufacturing - Farm Equipment industry was having an average PEG ratio of 1.75.