Q4 Preview: Deere (DE) Could See Surprise Upside as Fears Already Priced In
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Price: $638.67 +2.86%
Rating Summary:
18 Buy, 20 Hold, 5 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
18 Buy, 20 Hold, 5 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Deere & Co. (NYSE: DE) shares closed Tuesday down 1 percent, just hours ahead of the company's fourth-quarter 2011 report expected out before the market opens Wednesday. Click here to head over to the Investor Relations site for it's webcast, which is scheduled for 9:00am CST.
The Street is looking for earnings of $1.43 per share and revenue of $7.87 billion. Deere reported earnings of $1.48 per share in the same period last year.
Shares of Deere fell about 2.8 percent in the quarter and are down another 5.7 percent since. Deere has traded within a range of $59.92 to $99.80 over the last 52-week time frame.
Last quarter, Deere reported a book value of $18.19 and cash of $8.14 per share. Excluding cash, shares are going for about 8.9x next year's earnings expectations, compared to 9.7x at Caterpillar (NYSE: CAT).
Data from Bloomberg has 13 analysts with a Buy rating, eight at Hold, and two with a Sell. The analyst price target average is $86.50, with a low of $72 and high of $100.
Heading into numbers, Wells Fargo sees a modest upside surprise to its current earnings estimate of $1.45 per share. For 2012, Wells Fargo thinks investors have low expectations built in, due to: "(1) expected conservative F2012 outlook (as is typical), (2) anticipated FY2012 cost headwinds and (3) combine allocation away from the US/Canadian market to engineer a soft-landing for the regional used combine market."
"Expected guidance components are: 5-10% yr/yr revenue growth, subdued incremental margins due to cost headwinds (i.e., material/freight, post-retirement, and Tier 4 emissions product transition costs), and benefit from Credit and lower share count."
Wells Fargo maintains an Outperform rating and valuation range of $85 to $88 on Deere shares.
The Street is looking for earnings of $1.43 per share and revenue of $7.87 billion. Deere reported earnings of $1.48 per share in the same period last year.
Shares of Deere fell about 2.8 percent in the quarter and are down another 5.7 percent since. Deere has traded within a range of $59.92 to $99.80 over the last 52-week time frame.
Last quarter, Deere reported a book value of $18.19 and cash of $8.14 per share. Excluding cash, shares are going for about 8.9x next year's earnings expectations, compared to 9.7x at Caterpillar (NYSE: CAT).
Data from Bloomberg has 13 analysts with a Buy rating, eight at Hold, and two with a Sell. The analyst price target average is $86.50, with a low of $72 and high of $100.
Heading into numbers, Wells Fargo sees a modest upside surprise to its current earnings estimate of $1.45 per share. For 2012, Wells Fargo thinks investors have low expectations built in, due to: "(1) expected conservative F2012 outlook (as is typical), (2) anticipated FY2012 cost headwinds and (3) combine allocation away from the US/Canadian market to engineer a soft-landing for the regional used combine market."
"Expected guidance components are: 5-10% yr/yr revenue growth, subdued incremental margins due to cost headwinds (i.e., material/freight, post-retirement, and Tier 4 emissions product transition costs), and benefit from Credit and lower share count."
Wells Fargo maintains an Outperform rating and valuation range of $85 to $88 on Deere shares.
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