Jim Cramer’s Latest Comments on These 17 Stocks

6. Deere & Company (NYSE:DE)

Number of Hedge Fund Holders: 59

Deere & Company (NYSE:DE) is one of the stocks Jim Cramer mentioned in his latest comments. During the episode, a caller asked for Cramer’s thoughts on the stock, and Cramer replied:

“You want my thoughts on Deere? [buy, buy, buy] No matter who, no matter what happens in the country, we are a country where farmers get checks, and I think that’s great because I want them to keep farming. And what do you do… when you get a check? You buy a Deere.”

Deere & Company (NYSE:DE) manufactures and distributes agricultural, turf, construction, and forestry equipment, including tractors, harvesters, mowers, loaders, and road-building machinery. During the June 26 episode, Cramer discussed the company in detail and commented:

“In May of last year, I told you that Deere was finally taking control of its own destiny, even if that might… take some time to play out. And in retrospect, that was a good call… Funny thing about Deere, while the stock’s roared over the past 12 months, the company hasn’t been putting up particularly good numbers… But even though the numbers have been hideous in absolute terms, Deere’s results have consistently come in better than expected. How’s it possible? Simple. This company is hostage to the agriculture market, which means their business rise[s] and falls based on factors that they’ve got, let’s say, no control over…

More important, the stock’s been roaring because crop prices, interest rates, and the dollar have finally started going in the right direction, at least from Deere’s perspective… If rates are headed lower, that’s phenomenal for Deere’s business… Plus, there are all long-term reasons to like Deere that never really went away. This company is still the king of farm equipment with best-in-class technology…

… Deere is now selling for 27 times earnings. That’s somewhat higher for a machinery company, considerably higher than the S&P 500 PE multiple, but I think you can justify it given the tech angle. Plus, Deere’s a cyclical stock, and the cyclicals always seem expensive near the bottom. It looks pricey because the earnings are at a very low level. But if crop prices can bounce and interest rates come down, Deere will be able to report much better numbers.

So here’s the bottom line: After years of trading sideways, this stock’s finally had a major breakout over the past 10 odd months. Even though Deere and markets are still in pretty rough shape, but the stock’s working because the company always had great execution, and the agricultural equipment business is turning around. That’s why I think its rally, so far, can be justified and why I think it will continue to run.”