Is Deere & Company (DE) positioned for future growth?

Deere & Company (NYSE: DE) stock jumped 0.23% on Thursday to $354.88 against a previous-day closing price of $354.08. With 1.54 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.71 million shares. During the session, the Farm & Heavy Construction Machinery company that operates in wider Industrials sector, reached to the highest price of $357.39 whereas the lowest price it dropped to was $350.81. The 52-week range on DE shows that it touched its highest point at $448.40 and its lowest point at $283.81 during that stretch. It currently has a 1-year price target of $455.65. With its current market cap of 107.17 billion, DE has annualized dividend of $5.00 while the current yield stands at 1.41%. Beta for the stock currently stands at 1.03.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of DE was down-trending over the past week, with a drop of -4.22%, but this was down by -5.27% over a month. Three-month performance dropped to -14.98% while six-month performance fell -14.81%. The stock gained 5.30% in the past year, while it has lost -17.23% so far this year. A look at the trailing 12-month EPS for DE yields 26.96 with Next year EPS estimates of 32.06. For the next quarter, that number is 8.17. This implies an EPS growth rate of 22.60% for this year and 4.04% for next year. EPS is expected to grow by 13.14% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 28.40%.

Float and Shares Shorts:

At present, 297.60 million DE shares are outstanding with a float of 295.70 million shares on hand for trading. On Apr 27, 2023, short shares totaled 2.87 million, which was 0.97% higher than short shares on Mar 30, 2023. In addition to Mr. John C. May II as the firm’s Chairman, Pres & CEO, Mr. Joshua A. Jepsen serves as its Sr. VP & CFO.

Institutional Ownership:

Through their ownership of 78.71% of DE’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 37.07% of DE, in contrast to 33.92% held by mutual funds. Shares owned by individuals account for 11.15%. As the largest shareholder in DE with 7.07% of the stake, The Vanguard Group, Inc. holds 20,938,096 shares worth 20,938,096. A second-largest stockholder of DE, BlackRock Fund Advisors, holds 11,808,754 shares, controlling over 3.99% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in DE, holding 10,467,658 shares or 3.53% stake. With a 2.80% stake in DE, the Vanguard Total Stock Market ETF is the largest stakeholder. A total of 8,288,667 shares are owned by the mutual fund manager. The Vanguard 500 Index Fund, which owns about 2.14% of DE stock, is the second-largest Mutual Fund holder. It holds 6,347,022 shares valued at 2.4 billion. Government Pension Fund – Global holds 1.02% of the stake in DE, owning 3,027,199 shares worth 1.14 billion.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Apr 29, 2023, DE reported revenue of $13.37B and operating income of $2.74B. The EBITDA in the recently reported quarter was $3.19B and diluted EPS was $6.81.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for DE since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With DE analysts setting a high price target of $560.00 and a low target of $367.00, the average target price over the next 12 months is $450.43. Based on these targets, DE could surge 57.8% to reach the target high and rise by 3.42% to reach the target low. Reaching the average price target will result in a growth of 26.92% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded DE stock several times over the past three months with 10 Buys and 0 Sells. In these transactions, 3,930 shares were bought while 0 shares were sold. The number of buy transactions has increased to 39 while that of sell transactions has risen to 36 over the past year. The total number of shares bought during that period was 174,107 while 93,071 shares were sold.

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