Tractor and farm equipment manufacturer Deere (DE) saw its stock rally slightly on Thursday after the company released its earnings report for the Fiscal fourth quarter of 2024. That’s due to its earnings per share of $4.55, beating Wall Street’s estimates of $3.87. However, EPS is down 44.9% year-over-year from $8.26.
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Adding to this is Deere’s revenue of $11.143 billion, which is another beat to analysts’ estimates of $9.27 billion. Still, similar to the company’s EPS, Deere’s revenue also saw a year-over-year decline, with its net sales dropping 28% from $15.412 billion.
Market Conditions Weighed on Deere in Q4
Deere chairman and CEO John May noted that the company had to realign its business to achieve the results it did this quarter. According to May, “significant market challenges” forced the tractor maker to change its operations.
It wasn’t just these business changes that saved Deere this quarter. May also points to “structural improvements made over the past several years” as another reason the company could rise above Wall Street’s expectations.
What’s Next for DE Stock?
The Deere CEO says that “ongoing headwinds” continue to concern the company. Investors can clearly see that DE’s fiscal 2025 net income outlook ranges from $5 billion to $5.5 billion.
This net income guidance is likely keeping DE stock from seeing larger gains today despite its earnings beat. To understand why, investors will take note of the company’s net income of $7.1 billion in fiscal 2024 and $10.166 billion in fiscal 2023. This latest outlook is another example of how sliding profits are affecting Deere.
Is DE Stock a Buy?
Looking at Wall Street, the analysts’ consensus rating for Deere is Moderate Buy based on six Buy and three Hold ratings over the last three months. This comes with an average price target of $429.11, a high of $496, and a low of $342. That represents a potential 5.96% upside for DE shares.
