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Ignore FMC Stock: This Agricultural Innovator Is Reaping Rewards From AI and Automation
The Motley Fool· 2026-01-17 20:08
Core Viewpoint - Deere & Company is positioned as a leader in the agricultural sector, leveraging AI and automation to enhance farming efficiency, while FMC faces significant challenges due to declining demand for agricultural chemicals [1][10][11]. Group 1: Deere & Company Overview - Deere & Company, commonly known as John Deere, has been a significant player in agriculture since its founding in 1837, providing a wide range of farming equipment [3]. - The company is innovating with digital tools, AI, and autonomous driving technology to improve farming practices [4][8]. - In 2023, Deere's smart sprayers demonstrated a 50% reduction in water and chemical use, an 87% reduction in airborne drift, and a 93% reduction in chemical runoff during testing on 1 million acres [6][7]. Group 2: Financial Performance of Deere - Despite a challenging year in 2025, where net sales and revenue decreased by 12% and net income fell by 29%, Deere maintains a net income margin of 11% and has increased its dividend by 113% since 2020 [8][9]. - For Q4 2025, Deere reported an 11% increase in net sales and revenue, indicating a recovery trend as it continues to invest in technology [9]. Group 3: FMC Overview - FMC specializes in developing and producing pesticides and other agricultural chemicals, but is currently facing severe financial difficulties [11]. - In Q3 2025, FMC reported a 49% decline in revenue, dropping from over $1 billion to $542 million, and a net income loss of $569 million compared to a profit of $66 million in Q3 2024 [13][14]. Group 4: Financial Performance of FMC - FMC's earnings per share plummeted from $0.52 in Q3 2024 to a loss of $4.52 per share in Q3 2025, reflecting the company's struggles [13]. - The company's free cash flow is projected to decline from $614 million in 2024 to a loss of $100 million in 2025, coinciding with the rise of technologies that reduce pesticide use [14].