🌾 Deere & Company: 4th quarter results and future outlook!

An experienced player in the field of agricultural, construction and forestry
equipment, Deere & Company $DE, primarily known under the John Deere brand , has released its results for the 4th quarter of fiscal year 2024. Although the numbers showed a significant decline in profits and sales, some indicators exceeded analysts' expectations.

🔎 Highlights of the 4Q results:
The company's net profit fell by 47 %, but beat market expectations for earnings per share of $4.55 (forecast $3.87)
Agricultural Equipment: sales decline of 38 % to $4.31 billion, operating profit fell by 64 %
Construction and Forestry Equipment: Sales down by operating profit by 36 %
Small agricultural machinery: Sales down by 25 %, Operating profit fell by 47 %
Financial services was the only segment to record a revenue increase of 31 %, yet net profit fell by 8,9 %

📉 Outlook for fiscal year 2025:
Company expects overall revenue decline across major segments:
Agricultural Equipment: down by 15 %
Small Agricultural Equipment: down by 10 %
Construction and forestry: decrease between 10-15 %

On the contrary, the forecast is growth in financial serviceswhere net profits may reach up to 750 million. USDwhich exceeds market expectations.

The firm estimates total net profit for FY 2025 to be between USD 5-5.5bn, which lags market expectations (USD 5.83bn).

🌍 Market Influencing Factors:
After peaking in 2022, caused by rising grain prices and increased demand for agricultural equipment, the sector now faces a difficult comparison. New tariffs that could be introduced by the administration are another risk Donald Trump's administration.

The agricultural equipment sector is traditionally cyclical - there is always a cooling off period after a boom. Deere & Co. however, is showing that it has the ability to exceed market expectations even in challenging conditions.

Despite the drop in sales, the stock is up more than 9% today!

What do you think of the company?