Deere & Co (DE) stock analysis

P/E above its 5-year median

Deere's P/E of 38.4 is above its own 5-year median of 18.8.

P/E above the industry

Deere's P/E of 38.4 is above the Industrial and Commercial Machinery and Computer Equipment median of 27.1.

EV/EBITDA above its 5-year median

Deere's EV/EBITDA of 16.7 is above its 5-year median of 11.3.

P/B above the industry

Deere's price-to-book of 6.66 is above the Industrial and Commercial Machinery and Computer Equipment median of 2.71.

Trading above fair value

The share price of $691.75 is above our fair value estimate of $449.06.

Margin of safety under 20%

The price is 54.0% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -4.6% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -7.4% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -6.4% over the last twelve months, against a 5-year average of 12.8% a year.

Growing slower than the industry

Revenue grew 8.0% over the last twelve months; the Industrial and Commercial Machinery and Computer Equipment median is 10.1%.

Guidance raised

Deere raised its fiscal 2026 Net income attributable to Deere & Company outlook on Aug 20, 2026.

Gross margin trend

This company does not report gross profit.

Return on equity over 15%

Return on equity was 18.3% over the last twelve months and averaged 35.1% over five years.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Deere's return on equity of 18.3% is above the Industrial and Commercial Machinery and Computer Equipment median of 7.0%.

Earnings grew over 5 years

Net income grew 12.8% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 10.2% over the last twelve months, against a 5-year average of 13.7%.

Net margin above the industry

Deere's net margin of 10.2% is above the Industrial and Commercial Machinery and Computer Equipment median of 4.8%.

High debt

Debt is 61.1% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 319% five years ago to 61.1%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 42.3% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term liquidity

The balance sheet is not split into current and non-current items.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.66; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Deere paid dividends worth 0.9% of the share price over the last twelve months.

Yield below Treasuries

The 0.9% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Deere yields 0.9%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 36.0% of net income.

Covered by free cash flow

Dividends take 29.1% of free cash flow.