Earnings Preview: Deere & Co. (DE)

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On Wednesday August 15, we’ll get earnings from Deere & Co. (NYSE:DE).  First Call estimates are $1.99 EPS and $6.65 Billion revenues.   Next quarter will mark the end of its fiscal year and estimates for next quarter are $1.23 EPS and $5.65 Billion.  If we get a preview of Fiscal 2008 estimates, First call has $8.62 EPS and $25.6 Billion revenues, which still represents a 23.4% EPS gain on revenue growth of roughly 9%. 

Analysts are still mixed on the stock, but an average target that can be used ahead is $135.00.  Shares closed down 2.3% at $117.30 on Friday, and shares traded as high as $133.96 just back on July 19. Over the last couple weeks, Deere’s chart has gone more sideways than anything, but has gotten outside of its up=trend that had been in place since the end of 2006.  We’ll follow up with options data as we get closer to the report.

As an agriculture equipment seller, this one has been in a sweet spot for a long time.  This was noted as one of Jim Cramer’s Wild Bull Market Picks at the start of summer.  Now that values have caught up and now that the stock has reached this and higher levels, it looks like it has to now do some extra proving to be taken as a winner.

Jon C. Ogg
August 10, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.