One-glance verdict
Overvalued
$394.33 our estimate vs market $627.63
Wall Street consensus: $644.21 (63.4% higher than our fair-value estimate)
59% above our estimate, beyond the bull case
Fundamentals snapshot
Deere & Company
DE · NYQ · Industrials · Farm & Heavy Construction Machinery
Current price
$627.63
52-week range
$433.00 - $674.19
Market cap
$169.42B
Balance sheet
Stretched
2.65x Stretched
Net debt $39.64B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 3.7% last year.
- Reward Returns 18.3% on equity, ahead of 50% of its peers.
- Risk Stock trades 108.4% above its 5-year average P/E.
- Risk Net debt grew 16.9% over 3 years.
What this company does
Deere & Company
Deere & Company, famous for its green and yellow John Deere tractors, makes most of its money selling large, expensive equipment to farms, construction companies, and forestry operations. A key part of its strategy is its financing arm, which acts like a bank to lend money to customers and dealers, making it easier for them to buy Deere's own products. This approach helps drive sales of its pricey machinery while also generating interest income.
How the company got here
Deere & Company started in 1837 when a blacksmith named John Deere invented a steel plow that could easily cut through the tough soil of the American Midwest. This was a huge improvement over existing plows and helped farmers work their land much more efficiently. The company grew from there, expanding its product line to include tractors, combines, and other farming equipment, eventually becoming a global leader. Over the years, Deere has navigated economic challenges by focusing on innovation and expanding into new areas like construction and forestry.
What it actually does
You probably know Deere & Company by its brand name, John Deere, famous for its green and yellow tractors. The company manufactures and sells a wide variety of heavy equipment for farming, construction, and forestry. Think of everything from the massive combines that harvest corn and wheat to the excavators and loaders you see on construction sites. They also make smaller equipment for things like lawn care and golf courses, and even provide financing (loans and leases) to help customers buy their products.
Production and Precision Agriculture
This is Deere's largest business segment and focuses on equipment for large-scale farming operations. It provides big, powerful machines like four-wheel-drive tractors, combines for harvesting grain, and cotton pickers. This segment also includes high-tech solutions that help farmers be more efficient, a concept called 'precision agriculture' (using technology like GPS to manage crops more precisely). Farmers who grow crops like corn, wheat, and cotton on a large scale are the primary customers for this part of the business.
Small Agriculture and Turf
This segment caters to smaller farms, homeowners with large lawns, and businesses that manage golf courses and sports fields. The products here include smaller utility tractors, riding lawn mowers, and equipment for hay and forage. Essentially, if you need to mow a big lawn, tend to a small farm, or maintain a golf course, this is the part of Deere's business that serves you. It represents a significant, but smaller, portion of the company's sales compared to the large-scale agriculture division.
Construction and Forestry
This part of the company makes heavy machinery for building and logging. You'll see their equipment, like backhoes, bulldozers, and excavators, at construction sites. They also produce specialized machines for the forestry industry, such as log harvesters and skidders, which are used to cut down and transport trees. This segment serves construction companies and logging businesses around the world.
Financial Services
This segment acts like a bank specifically for Deere customers. It provides financing for people and businesses who want to buy or lease John Deere equipment. For example, a farmer might get a loan from John Deere Financial to buy a new tractor. This division also offers wholesale financing to dealers (the businesses that sell Deere equipment) and provides extended warranties on the machinery.
What management is betting on now
Deere's current strategy, which they call the 'Smart Industrial' model, is focused on integrating technology into their machines to make them more intelligent and connected. The goal is to move beyond just selling a piece of equipment and instead provide a complete solution that helps customers be more productive and profitable over the long term. This includes developing autonomous (self-driving) equipment and expanding their use of software and data to help farmers and construction crews work more efficiently. They are also focused on growing their recurring revenue (ongoing income from subscriptions and services, rather than one-time sales).
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$2.87B
FY2024 Q4
$4.50B
FY2025 Q1
$-1.48B
FY2025 Q2
$1.50B
FY2025 Q3
$2.60B
FY2025 Q4
$3.49B
FY2026 Q1
$-1.15B
FY2026 Q2
$1.74B
Revenue
$13.37B
Net income
$1.77B
Diluted EPS
6.55
Operating cash flow
$1.93B
Free cash flow
$1.74B
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Sources
Revenue
$9.61B
Net income
$656.00M
Diluted EPS
2.42
Operating cash flow
$-890.00M
Free cash flow
$-1.15B
Fetching…
Sources
Revenue
$12.39B
Net income
$1.06B
Diluted EPS
3.92
Operating cash flow
$4.00B
Free cash flow
$3.49B
Fetching…
Sources
Revenue
$12.02B
Net income
$1.29B
Diluted EPS
4.75
Operating cash flow
$2.90B
Free cash flow
$2.60B
Fetching…
Sources
Revenue
$12.76B
Net income
$1.80B
Diluted EPS
6.64
Operating cash flow
$1.70B
Free cash flow
$1.50B
Fetching…
Sources
Revenue
$8.51B
Net income
$869.00M
Diluted EPS
3.19
Operating cash flow
$-1.13B
Free cash flow
$-1.48B
Fetching…
Sources
Revenue
$11.14B
Net income
$1.25B
Diluted EPS
4.57
Operating cash flow
$5.09B
Free cash flow
$4.50B
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Sources
Revenue
$13.15B
Net income
$1.73B
Diluted EPS
6.29
Operating cash flow
$3.19B
Free cash flow
$2.87B
Fetching…
Sources
Is it cheap or expensive?
Fair value $394.33 vs current price $627.63
Wall Street consensus is the average analyst price target: $644.21 (63.4% higher than our fair-value estimate).
Our most-likely fair value is $394.33 a share — about 37.2% below today's price of $627.63, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Stretched
Net debt $39.6B. Interest coverage 2.7x.
Net debt
$39.64B
Interest coverage
2.65x
Deere & Company's profit covers its interest bill about 2.7 times over.
Stretched
Worse cushion
Baseline
Better cushion
DE
BASELINE
Deere & Company
Total debt $48.47B Interest coverage 2.65x This is the baseline the peer rows are being compared against.
Total debt $43.07B Interest coverage 22.21x +737% vs DE Carries about 8.4x more debt cushion than DE.
Total debt $26.26B Interest coverage 1.89x -29% vs DE Carries about 1.4x less debt cushion than DE.
Total debt $2.74B Interest coverage 5.68x +114% vs DE Carries about 2.1x more debt cushion than DE.
Total debt $15.05B Interest coverage 10.42x +292% vs DE Carries about 3.9x more debt cushion than DE.
Total debt $1.14B Interest coverage 8.31x +213% vs DE Carries about 3.1x more debt cushion than DE.
What you should know
The case for and against DE
3 Rewards
3 Risks
Rewards
-
Revenue grew 3.7% last year.
-
Returns 18.3% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 108.4% above its 5-year average P/E.
-
Net debt grew 16.9% over 3 years.
-
Insider ownership is only 0.2% (peer median: 1.9%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
35.58x
Forward P/E
27.46x
P/B
6.18x
P/S
3.58x
EV/EBITDA
24.27x
PEG ratio
1.93x
Profitability
How much profit each dollar creates
Gross margin
26.0%
Operating margin
17.5%
Net margin
10.1%
ROE
18.3%
ROA
3.8%
Health
Liquidity and balance-sheet strength
Debt / equity
3.76x
Current ratio
2.21x
Quick ratio
1.97x
Total debt
$48.47B
Total cash
$8.83B
Growth
How the business has been compounding
Revenue TTM
$47.39B
Revenue 5Y CAGR
0.9%
EPS TTM
17.64
EPS 5Y CAGR
-7.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$7.93B
Free CF TTM
$6.10B
FCF margin
12.9%
Dividend
Shareholder payout
Yield
1.0%
Payout ratio
36.7%
Last ex-div date
2026-06-30