Group 1: Stock Performance - Deere's stock increased by 1.94% to $519.20, outperforming the S&P 500's daily gain of 0.28% [1] - Over the past month, Deere's shares declined by 2.21%, underperforming the Industrial Products sector's gain of 5.67% and the S&P 500's gain of 4.37% [1] Group 2: Earnings Projections - Deere is projected to report earnings of $4.6 per share, reflecting a year-over-year decline of 26.87% [2] - Revenue is expected to be $10.21 billion, indicating a 10.32% drop compared to the same quarter last year [2] Group 3: Fiscal Year Estimates - For the fiscal year, earnings are estimated at $18.82 per share and revenue at $38.05 billion, representing declines of 26.54% and 14.99% respectively from the previous year [3] - Recent changes in analyst estimates may indicate evolving short-term business trends, with positive revisions suggesting a favorable outlook on business health and profitability [3] Group 4: Zacks Rank and Valuation - Deere currently holds a Zacks Rank of 3 (Hold), with the consensus EPS estimate remaining stagnant over the past month [5] - The Forward P/E ratio for Deere is 27.06, which is higher than the industry average of 21.81, indicating that Deere is trading at a premium [6] Group 5: PEG Ratio and Industry Ranking - Deere has a PEG ratio of 3.23, which is in line with the average PEG ratio of the Manufacturing - Farm Equipment industry [7] - The Manufacturing - Farm Equipment industry is ranked 174 in the Zacks Industry Rank, placing it in the bottom 30% of over 250 industries [7][8]

Financial Data and Key Metrics Changes - Total revenue for the first quarter was $594.3 million, down from $628.7 million in the prior year, reflecting a 5.5% decrease in same-store sales [18] - Gross profit decreased to $90.9 million from $121.8 million, with a gross profit margin of 15.3% [18] - Net loss for the quarter was $13.2 million, or $0.58 per diluted share, compared to a net income of $9.4 million, or $0.41 per diluted share in the previous year [20] Business Line Data and Key Metrics Changes - Agriculture segment revenue decreased by 14.1% to $384.4 million, with a pretax loss of $12.8 million compared to pretax income of $13 million in the prior year [20] - Construction segment saw a slight increase in same-store sales by 0.9% to $72.1 million, but reported a pretax loss of $4.2 million compared to a pretax income of $0.3 million last year [21] - European segment revenue increased by 44.2% to $93.9 million, with a pretax income of $4.7 million compared to $1.4 million in the prior year [21] - Australia segment same-store sales decreased by 1% to $44 million, with a pretax loss of $0.6 million compared to a loss of $0.5 million last year [22] Market Data and Key Metrics Changes - Domestic agriculture market remains subdued, with farmers in a wait-and-see mode influenced by commodity prices and government aid [11][12] - European market, particularly Romania, benefited from EU stimulus funds, leading to increased buying activity [14] - Australian market conditions are similar to the domestic agriculture segment, with lower new order activity due to dry conditions and low commodity prices [15][16] Company Strategy and Development Direction - The company is focused on optimizing inventory and managing through the current market cycle, with a target of reducing equipment inventory by $100 million [24][25] - The customer care initiative is emphasized, with parts and service expected to contribute significantly to revenue and gross profit [10] - The company anticipates a challenging back half of the year but remains committed to disciplined execution and improving inventory health [16][29] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing headwinds in the agricultural sector, with weak farmer profitability and uncertain government support impacting demand [9][10] - The construction segment shows more stability compared to agriculture, with contractors starting to fill their project backlogs [38][40] - Management expressed cautious optimism regarding the agricultural sector, citing recent government payments and favorable weather conditions as potential stabilizers [34][35] Other Important Information - The company closed on an acquisition of two stores to expand its presence in Eastern South Dakota [13] - The adjusted debt to tangible net worth ratio was 1.8, well below the bank covenant of 3.5 times [23] Q&A Session Summary Question: Is there any positive outlook on the agricultural sector? - Management indicated that some government payments have started to come through, providing stability, but overall conditions remain challenging [34] Question: How is the construction sector performing amid macro uncertainties? - Management noted that while the construction environment is cautious, there is more positivity compared to agriculture, with contractors seeing improved backlogs [38][40] Question: What programs is the USDA looking to implement for additional support? - Management explained that USDA programs are focused on natural disaster relief and specific allocations to support the agricultural industry [46][48] Question: Are inventories expected to remain flattish in Europe? - Management confirmed that inventory levels in Europe are expected to remain stable, with a focus on reducing aged inventory in North America [58][60] Question: What is the outlook for same-store sales in agriculture for Q2? - Management expects same-store sales in agriculture to be down approximately 30% year-over-year for Q2, with a challenging back half of the year anticipated [75][76]

Financial Data and Key Metrics Changes - Total revenue for Q1 fiscal 2026 was $594.3 million, a decrease of 5.5% from $628.7 million in the prior year period [17] - Gross profit decreased to $90.9 million from $121.8 million, with a gross profit margin of 15.3% [17] - Net loss for Q1 was $13.2 million, or $0.58 per diluted share, compared to net income of $9.4 million, or $0.41 per diluted share in the previous year [19] Business Line Data and Key Metrics Changes - Agriculture segment revenue decreased by 14.1% to $384.4 million, with a pretax loss of $12.8 million compared to pretax income of $13 million in the prior year [19] - Construction segment saw a slight increase in same store sales by 0.9% to $72.1 million, but reported a pretax loss of $4.2 million compared to pretax income of $0.3 million last year [20] - European segment revenue increased by 44.2% to $93.9 million, with a pretax income of $4.7 million compared to $1.4 million in the prior year [20] - Australia segment revenue decreased by 1% to $44 million, with a pretax loss of $0.6 million compared to a loss of $0.5 million last year [21] Market Data and Key Metrics Changes - Domestic agriculture market remains subdued, with farmers in a wait-and-see mode due to commodity prices and government aid uncertainty [10][11] - European market, particularly Romania, benefited from EU stimulus funds, leading to increased buying activity [13] - Australian market conditions are similar to the domestic agriculture segment, with lower new order activity due to dry conditions and low commodity prices [15] Company Strategy and Development Direction - The company is focused on optimizing inventory and managing through the current market cycle, with a target of reducing equipment inventory by $100 million [22][23] - The strategy includes leveraging parts and service revenue, which is expected to contribute significantly to gross profit despite equipment sales pressures [9][27] - The company aims to emerge from the current down market as a stronger entity, emphasizing customer service and operational efficiency [16] Management's Comments on Operating Environment and Future Outlook - Management anticipates a subdued retail environment due to weak farmer profitability and undefined government support programs [6][7] - The company expects continued challenges in the agriculture segment, with revenue projected to decline by 20% to 25% for the full year [24] - For the construction segment, revenue is expected to decline by 5% to 10%, while the European segment is projected to grow by 23% to 28% [25][26] Other Important Information - The company has successfully reduced equipment inventory by approximately $13 million sequentially, with a cumulative reduction of $406 million from peak levels [22] - The adjusted debt to tangible net worth ratio was 1.8, well below the bank covenant of 3.5 times [22] Q&A Session Summary Question: Is there any positive outlook on the agricultural sector? - Management noted that some government payments have started to come through, providing stability, but the overall outlook remains challenging [32] Question: How is the construction sector performing? - Management indicated that while the construction sector is cautious, there is more optimism compared to agriculture, with contractors starting to fill their project backlogs [36][38] Question: What is the status of government support programs? - The USDA is looking to provide additional funding for natural disaster relief, which could help stabilize the agricultural sector [42][44] Question: Are there specific areas where inventory needs to be reduced? - Management highlighted that the focus is on reducing used inventory levels, particularly in the agriculture segment, while maintaining a healthy inventory mix [56][57] Question: What are the expectations for same store sales in agriculture? - Management expects same store sales in agriculture to be down about 30% year over year for Q2, with a challenging back half of the year anticipated [72]

Group 1 - Deere reported quarterly earnings of $6.64 per share, exceeding the Zacks Consensus Estimate of $5.68 per share, but down from $8.53 per share a year ago, representing an earnings surprise of 16.90% [1] - The company posted revenues of $11.17 billion for the quarter ended April 2025, surpassing the Zacks Consensus Estimate by 4.89%, compared to year-ago revenues of $13.61 billion [2] - Deere has surpassed consensus EPS estimates four times over the last four quarters and topped consensus revenue estimates three times during the same period [2] Group 2 - The stock has gained approximately 17.4% since the beginning of the year, significantly outperforming the S&P 500's gain of 0.2% [3] - The current consensus EPS estimate for the upcoming quarter is $5.35 on revenues of $10.44 billion, and for the current fiscal year, it is $18.89 on revenues of $38.23 billion [7] - The Zacks Industry Rank for Manufacturing - Farm Equipment is currently in the bottom 36% of over 250 Zacks industries, indicating potential challenges for stock performance [8]

Core Viewpoint - The market anticipates a year-over-year decline in Deere's earnings due to lower revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - Deere is expected to report quarterly earnings of $5.68 per share, reflecting a year-over-year decrease of 33.4% [3]. - Revenue projections stand at $10.65 billion, down 21.8% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 1.85% over the last 30 days, indicating a bearish sentiment among analysts [4]. - The Most Accurate Estimate for Deere is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.24% [10][11]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that a positive reading is a strong predictor of an earnings beat, particularly when combined with a favorable Zacks Rank [8]. - However, a negative Earnings ESP does not necessarily indicate an earnings miss, making predictions less reliable [9]. Historical Performance - In the last reported quarter, Deere exceeded expectations with earnings of $3.19 per share against an estimate of $3.13, resulting in a surprise of +1.92% [12]. - Over the past four quarters, Deere has consistently beaten consensus EPS estimates [13]. Conclusion - Despite the potential for an earnings miss, betting on stocks expected to beat earnings can improve success odds, highlighting the importance of monitoring Earnings ESP and Zacks Rank [15]. - Currently, Deere does not appear to be a strong candidate for an earnings beat, suggesting investors should consider other factors before making decisions [16].

Core Viewpoint - Deere has been gaining attention in the market, with its stock performance outpacing the broader S&P 500 index and the farm equipment industry, raising questions about its future trajectory [2]. Earnings Estimates - Deere is expected to report earnings of $5.68 per share for the current quarter, reflecting a year-over-year decline of -33.4%. The consensus estimate for the current fiscal year is $18.89, indicating a -26.3% change [5][6]. - The consensus earnings estimate for the next fiscal year is $21.17, which represents a +12.1% increase compared to the previous year [6]. Revenue Projections - The consensus sales estimate for the current quarter is $10.65 billion, showing a year-over-year decrease of -21.8%. For the current and next fiscal years, the sales estimates are $38.23 billion and $40.52 billion, indicating changes of -14.6% and +6%, respectively [11]. Recent Performance - In the last reported quarter, Deere's revenues were $6.81 billion, down -35.1% year-over-year, with an EPS of $3.19 compared to $6.23 a year ago. The reported revenues fell short of the Zacks Consensus Estimate of $7.7 billion by -11.51% [12]. - The company has consistently beaten consensus EPS estimates in the last four quarters and has exceeded revenue estimates three times during this period [13]. Valuation Metrics - Deere's valuation metrics suggest it is trading at a premium compared to its peers, receiving a Zacks Value Style Score of D, indicating potential overvaluation [17].

The latest trading session saw Deere (DE) ending at $460.64, denoting a +0.1% adjustment from its last day's close. The stock trailed the S&P 500, which registered a daily gain of 0.58%. Meanwhile, the Dow experienced a rise of 0.75%, and the technology-dominated Nasdaq saw an increase of 0.55%.Shares of the agricultural equipment manufacturer witnessed a loss of 1.95% over the previous month, beating the performance of the Industrial Products sector with its loss of 3.25% and underperforming the S&P 500's ...

Core Viewpoint - Deere's stock performance has been closely monitored, with a recent return of -3.2% over the past month, outperforming the S&P 500's -4.8% and the Zacks Manufacturing - Farm Equipment industry's -4% [1] Earnings Estimate Revisions - For the current quarter, Deere is expected to report earnings of $5.68 per share, reflecting a -33.4% change year-over-year, with a consensus estimate change of -1.1% over the last 30 days [4] - The consensus earnings estimate for the current fiscal year is $18.91, indicating a -26.2% change from the previous year, with a -2% change in the estimate over the last 30 days [4] - For the next fiscal year, the consensus estimate is $21.22, showing a +12.2% change from the prior year, with a -2.7% change in the estimate over the past month [5] - Deere holds a Zacks Rank 3 (Hold) due to the recent changes in consensus estimates and other related factors [6] Projected Revenue Growth - The consensus sales estimate for the current quarter is $10.65 billion, indicating a -21.8% year-over-year change [10] - For the current fiscal year, the sales estimate is $38.23 billion, reflecting a -14.6% change, while the next fiscal year's estimate of $40.56 billion indicates a +6.1% change [10] Last Reported Results and Surprise History - In the last reported quarter, Deere's revenues were $6.81 billion, down -35.1% year-over-year, with an EPS of $3.19 compared to $6.23 a year ago [11] - The reported revenues were -11.51% below the Zacks Consensus Estimate of $7.7 billion, while the EPS surprise was +1.92% [11] - Deere has beaten consensus EPS estimates in the last four quarters and topped revenue estimates three times during this period [12] Valuation - Deere is graded D on the Zacks Value Style Score, indicating it is trading at a premium compared to its peers [16]

Financial Data and Key Metrics Changes - Total revenue for the fourth quarter was $759.9 million, a 12% decrease from $852.1 million in the prior year period [18] - Gross profit for the fourth quarter was $51 million, down from $141 million in the prior year, resulting in a gross profit margin of 6.7% [18] - Adjusted net loss for the fourth quarter was $44.9 million or $1.98 per diluted share, compared to a net income of $24 million or $1.05 per diluted share in the prior year [20][24] - Total revenue for fiscal year 2025 was $2.7 billion, down from $2.8 billion in fiscal year 2024 [24] Business Line Data and Key Metrics Changes - Agriculture segment sales decreased by 13.8% to $534.7 million, with same store sales declining by 15.5% [20] - Construction segment same store sales decreased by 5.5% to $94.6 million, maintaining an equipment margin above 10% [21] - European segment sales increased by 6.1% to $65.4 million, with a same store sales increase of 5.7% [23] - Australia segment sales were $65.3 million, down from $69.8 million in the prior year, driven by a same store sales decrease of 6.5% [23] Market Data and Key Metrics Changes - North American large ag equipment demand is expected to decline by approximately 30% year-over-year [11] - European operations were impacted by lower commodity prices and high interest rates, with expectations for modest revenue growth in FY 2026 [12] - Australian operations faced challenges due to weather conditions, leading to lower profitability and restricted demand in FY 2026 [12] Company Strategy and Development Direction - The company is focusing on inventory optimization and reducing aged inventory while investing in new equipment categories [9][27] - The strategy includes enhancing operational efficiency and maintaining a strong customer care strategy to drive recurring revenue from parts and service [15][16] - The company anticipates a gradual improvement in equipment margins as it optimizes its product mix throughout fiscal year 2026 [33] Management's Comments on Operating Environment and Future Outlook - Management noted that while market headwinds are expected to persist, improvements made during fiscal year 2025 position the company to navigate the current cycle effectively [16] - The company is monitoring government assistance programs and their potential impact on farmer purchasing decisions amid tariff uncertainties [47][50] - Management expressed cautious optimism regarding the construction segment's long-term outlook, supported by federal infrastructure initiatives [14] Other Important Information - The company achieved a significant inventory reduction of $419 million since peaking in the second quarter of fiscal year 2025 [26] - The adjusted debt to tangible net worth ratio was 1.8 times as of January 31, 2025, well below the bank covenant of 3.5 times [25] Q&A Session Summary Question: Service margin performance - Management expects equipment margin to increase year-over-year, attributing past inefficiencies to the transition to a new ERP system [42] Question: Inventory reduction methods - The company primarily reduced inventory through its dealer network, with some units auctioned as necessary [44] Question: Impact of tariffs on business - Management is closely monitoring tariffs and their potential impact on demand, noting that government payments could help bolster farmer operations [47][50] Question: Government assistance comparison to previous years - Management highlighted differences in the current situation compared to past government assistance periods, noting potential positive impacts depending on how negotiations unfold [56][58] Question: Optimal inventory levels - Management indicated that the targeted inventory reduction is based on current demand expectations, with flexibility to adjust as needed [64][66] Question: SG&A guidance for fiscal year 2026 - The midpoint of guidance for SG&A expenses is approximately $380 million, reflecting a decrease from fiscal year 2025 [76] Question: Floor plan payable interest levels - Interest-bearing debt under the floor plan was approximately $385 million, with expectations to reduce this significantly in the coming year [84][86]