On Wednesday, Deere & Company (NYSE:DE) will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.
Deere & Company (NYSE:DE) has benefited greatly from the strong agricultural industry in recent years. With the spring planting pointing toward a strong season as farmers try to rebound from a drought-stricken 2012, the company hopes to sell farmers the equipment they need to maximize their crop yields. Let’s take an early look at what’s been happening with Deere & Company (NYSE:DE) over the past quarter and what we’re likely to see in its quarterly report.
Stats on Deere
|Analyst EPS Estimate||$2.72|
|Change From Year-Ago EPS||4.2%|
|Revenue Estimate||$9.81 billion|
|Change From Year-Ago Revenue||4.3%|
|Earnings Beats in Past 4 Quarters||2|
How will Deere’s earnings garden grow this quarter?
Analysts have had mixed views on Deere & Company (NYSE:DE)’s earnings recently, cutting their April-quarter estimates by $0.02 per share but boosting their full-year fiscal 2013 projections by almost $0.25 per share. The stock has barely budged, rising less than 1% since early February.
Deere & Company (NYSE:DE) has faced some of the same headwinds that have held back more industrially focused companies. With the recent slowdown in Chinese growth weighing on economic activity worldwide, construction-equipment maker Caterpillar Inc. (NYSE:CAT) recently announced plans to cut jobs in order to keep its costs down. Along with Caterpillar Inc. (NYSE:CAT), Joy Global Inc. (NYSE:JOY) has made its own restructuring, and the plunge in gold prices recently bodes ill for the mining-equipment business that Joy and Caterpillar Inc. (NYSE:CAT) rely on for much of their sales.
Still, Deere & Company (NYSE:DE) looks poised to benefit from much better weather conditions so far this year than the drought last year that crushed crop production. Although a USDA report last Friday noted that very recent wet and cold weather in the Midwest might temper earlier projections, it still forecast that global harvests of soybeans will rise to an all-time high and push world crop inventories to new records as well, while corn inventories are seen rising to decade-highs.