Deere & Company Faces EPS Decline Ahead of Earnings Report

Deere & Company is set to report Q1 2025 earnings, with projected EPS at $3.11, a 50.1% decline year-over-year. Despite this, the company has a history of exceeding estimates and anticipates EPS growth of 14.5% in fiscal 2026, fostering cautious investor optimism.

Date: 21-01-2025

AI Rating: 5

EPS Performance and Projections: The report indicates Deere & Company's expected earnings per share (EPS) for Q1 2025 is projected at $3.11, which represents a notable decline of 50.1% from the $6.23 reported in the same quarter last year. This significant drop could raise concerns among investors about the company's ability to maintain profitability in the near term.

Nonetheless, the company's historical performance shows a strong track record of exceeding Wall Street's earnings estimates. In the most recent quarter, DE surpassed the consensus EPS estimate by nearly 17%, which reflects the potential for a positive surprise in upcoming reports despite the negative projections.

Looking ahead, analysts forecast that for fiscal 2025, DE's EPS will be $19.34, marking a 24.5% decrease compared to the previous fiscal year. However, for fiscal 2026, EPS is expected to rebound with a growth of 14.5%, reaching $22.15. This projection suggests resilience and potential recovery, which could influence investor sentiment positively in the long term.

Revenue Insights and Market Performance: The report notes a recent 8.1% rise in shares of Deere & Company, driven by stronger-than-expected Q4 performance, where Q4 EPS was reported at $4.55 along with robust equipment operations sales of $9.3 billion. Although there is a year-over-year decline in earnings and sales, the company's ability to exceed expectations in specific segments and mitigate operational challenges has garnered investor confidence. Revenue growth in key sectors like Production & Precision Agriculture and Financial Services notably contributed to this positive response from the market.

Despite the current challenges faced in the upcoming fiscal year, the outlook for the following fiscal year appears significantly more optimistic, indicating that the company's strategies may bear fruit, thus impacting future growth and potentially stabilizing or increasing stock prices.

Stocks: DE