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Deere: The 5 Tailwinds Supporting A Buy Rather Than A Sell

Mar. 23, 2023 10:46 AM ETDeere & Company (DE)CAT, CNHI7 Comments
Luca Socci profile picture
Luca Socci


  • Some analysts recently downgraded Deere to a sell.
  • Deere runs a business whose cyclicality is indisputable. Yet, it is targeting a new way to create a stream of recurring revenue.
  • Thanks to easy comparables, Q2 results should be impressive, as strong tailwinds suggest this agriculture machinery replacement cycle may last longer than expected.

Combine During Wheat Harvest

Nicholas Smith


When considering farming machinery and equipment manufacturers, Deere (NYSE:DE) is the undisputable market leader, with high brand recognition and a TTM revenue of $55.65 billion that is more than twice as large as CNH Industrial's (

This article was written by

Luca Socci profile picture
I focus on long term growth and dividend growth investing. I follow both the US and the European stock markets, looking for undervalued stock and/or for high quality dividend growing companies that provide me with cash to reinvest. I invest only in stock of companies that run a business I understand through direct experience.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of CNHI either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (7)

Intrinsic value is around $734. With a 20% margin of safety, an acceptable buy price would be around $588. Crazy how undervalued the stock is right now! I will be purchasing around the $382 price tag which is just above it's 200 moving average.
Let this cycle fall a little more. I'm not adding until the 330s to 350s.
Luca Socci profile picture
@bsuszka did you had the chance to add in that range? It seems like it is paying off.
@Luca Socci added a little bit at 373. Didn't fall enough to add in more
tryin to get rich profile picture
Interesting. If things were deteriorating, I would expect to see insider selling. So far there has been none.
Luca Socci profile picture
@tryin to get rich I actually see the quality of Deere's revenue improve as they transition to recurring revenue through the development of their service business. Insiders probably know better than us how valuable this can become.
Well managed company DE, outstanding products also a fair valuation, good time to add shares.
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