John Deere(US:DE) 247Wallst·2026-02-19 18:26Core Viewpoint - Deere & Company reported strong Q1 fiscal 2026 results, exceeding expectations in revenue and earnings despite a decline in profits from the previous year [1] Financial Performance - Equipment operations net sales reached $8 billion, a 17.5% increase year-over-year, surpassing the consensus estimate of $7.59 billion to $7.92 billion [1] - Earnings per share were $2.42, down 24% from $3.19 a year earlier, but above analyst forecasts of $2.02 to $2.11 [1] - Overall worldwide net sales and revenues totaled $9.6 billion, reflecting a 13% increase [1] - Full-year net income guidance was raised to $4.5 billion to $5 billion, up from the previous range of $4 billion to $4.75 billion [1] Segment Performance - The Production & Precision Agriculture segment saw net sales increase by only 3% to $3.16 billion, with operating profit dropping 59% to $140 million [1] - The Small Agriculture & Turf segment experienced a 24% rise in net sales to $2.17 billion and a 58% increase in operating profit to $196 million [1] - The Construction & Forestry segment reported a 34% increase in sales to $2.67 billion, with operating profit more than doubling to $137 million [1] Market Outlook - Deere anticipates a 5% to 10% decline in Production & Precision Agriculture sales for the full fiscal 2026 year, but sees stabilization in the large agriculture sector [1] - Small agriculture and turf sales are projected to grow around 15%, an improvement from the earlier forecast of 10% [1] - The Construction & Forestry division expects full-year sales to rise about 15%, driven by increased infrastructure spending [1] Valuation and Investment Considerations - Deere stock has appreciated approximately 27% year-to-date, trading at 32 times trailing earnings compared to a five-year average of 19 times [1] - The EV/EBITDA ratio stands at 18.3, significantly above the five-year average near 13, suggesting a high valuation [1]