Deere & Co. (DE) Looks to Impress with Q1 Numbers

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Heavy machinery maker Deere & Co. (DE) is set to report first-quarter results after the market close May 16. Analysts expect earnings of $3.57 per share on revenue of $10.1 billion. During the same period last year Deere earned $3.67 on sales of $10.72 billion. DE stock is up a modest 3.7% on the year.

Technical Analysis

DE stock was recently trading at $154.73 down $15.26 from its 12-month high and $26.41 above its 12-month low. InvestorsObserver’s Stock Score Report gives DE a 59 long-term technical score and a 52 short-term technical score. The stock has recent support above $145 and recent resistance below $165. Of the 12 analysts who cover the stock 6 rate it Strong Buy, 1 rate it Buy, 5 rate it Hold, 0 rate it Sell, and 0 rate it Strong Sell, DE gets a score of 58 from InvestorsObserver’s Stock Score Report.

Analysts' Thoughts

Deere got off to a strong start to the year, but the stock has been giving back a good amount of its previous gains as trade negotiations with China have begun to break down and new tariffs are being imposed. China will retaliate, and so far its primary target has been America’s farmers, which has the potential to weaken demand on weight on Deere’s total sales. DE stock has a low valuation and trades at just 12 times future earnings. Analysts expect profits to rise at an annual rate of 19.5% over the next five years which will drive shares higher barring any significant earnings miss and negative impact of the trade war. Analysts remain bullish on the stock with an average price target of $174.00.

About Deere & Company

Deere is the world's leading manufacturer of agricultural equipment with approximately $35 billion in annual revenue. The company is divided into two reportable segments 1) agriculture and turf and 2) construction and forestry. Approximately 55% of Deere equipment is sold in North America and Canada. The principle products harvested by Deere equipment include grain, oilseeds, cotton, sugar, and biomass. In 2018, agriculture and turf made up approximately 70% of total revenue while construction and forestry generated 30%.

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