- CreditSuisse analyst repeated Jamie Cook a Outperform rating for the shares of Deer & Company EN and raised the target price to $582 from $447.
- Deere Q4 22 sales increased 40% on EPS up 81%.
- The Q4 beat was fueled by strength across all segments. P&PA revenue of $7.434 billion rose 59% and operating margin was 23.4%, up 670 basis points from 16.7% last year, reflecting higher production rates, the analyst said.
- Related: Deere posts strong Q4 performance despite inflation and signals strong profit for FY23
- For 2023, Deere presented a net income guidance of $8.0 billion to $8.5 billion, which is 5% above average, reflecting strong pricing, healthy industry prospects, and expanded visibility into next year.
- Cook added that Deere’s order book for large AGs is full through the third quarter of fiscal 23 and order velocity remains strong.
- Despite macro concerns, Deere also sees strong demand for construction equipment, with the order book stretching into H2FY23 as stimulus to oil and gas infrastructure begins to take hold.
- Demand for small AGs remains resilient, reflected in the order book for mid-size tractors, which is 70% full through Q3 2023.
- Deere expects to continue generating cash despite organic and inorganic investments, with CFO forecasting $9-9.5 billion.
- Cook announced the company expects 2023 to be another strong year based on positive agricultural fundamentals and fleet dynamics as well as increased investment in infrastructure supporting healthy demand for equipment.
- also read: Does Deere jump over 33%? These analysts raise target prices for the farm equipment maker following fourth-quarter results
- Price promotion: DE shares traded 0.82% higher at $441.11 on the last check Friday.
- Photo via Wikimedia Commons
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights…
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