📊 DE Key Takeaways
Is Deere & Co (DE) a Good Investment?
Deere is a profitable company navigating a cyclical downturn in farm equipment demand, evidenced by 11.7% revenue decline, yet maintaining strong 39.3% operating margins and positive profitability. However, weak free cash flow generation of only $591M (2.6% margin) and elevated debt-to-equity ratio of 1.18x limit financial flexibility during this revenue contraction, creating meaningful near-term headwinds despite operational efficiency.
Deere still shows meaningful gross profitability, solid interest coverage, and a balance sheet supported by substantial equity and cash, which suggests the business remains financially resilient through a weaker part of the cycle. However, the sharp revenue decline, negative operating and free cash flow, and unusually inconsistent margin data reduce confidence in earnings quality and near-term fundamental momentum. On balance, the company appears fundamentally durable but not cleanly strong enough for a more aggressive rating based on the current dataset.
Deere & Co Key Strengths (DE)
- Exceptional operating margin of 39.3% reflects strong pricing power and operational efficiency in a challenging environment
- Net income growth of 0.6% YoY despite double-digit revenue decline demonstrates margin expansion and cost control capabilities
- Strong interest coverage ratio of 6.3x indicates comfortable debt servicing capacity
- Solid cash position of $7.9B provides financial cushion and operational flexibility
- Gross margin of 22.8% indicates the core equipment business remains meaningfully profitable despite lower sales
- Interest coverage of 12.6x suggests debt service is manageable even with a sizable debt load
- Cash of $6.80B and equity of $26.30B provide balance-sheet support during an industry downturn
DE Stock Risks: Deere & Co Investment Risks
- Sharp 11.7% revenue decline signals cyclical downturn in farm equipment demand with unclear recovery timeline
- Critically weak free cash flow conversion at only 2.6% FCF margin severely limits debt reduction and capital deployment capacity
- Elevated debt-to-equity ratio of 1.18x combined with declining revenue increases financial risk if downturn extends beyond current period
- EPS decline of 27.8% YoY outpaces modest net income growth, suggesting share dilution or structural earnings headwinds
- Revenue fell 11.7% year over year, pointing to cyclical demand pressure and weaker operating momentum
- Operating cash flow of -$890.00M and free cash flow of -$1.15B indicate weak cash conversion in the latest period
- Reported operating income and margin appear inconsistent with gross profit, raising concerns about data quality and the reliability of some profitability signals
Key Metrics to Watch
- Revenue stabilization and return to growth trajectory
- Free cash flow margin improvement and operating cash flow recovery
- Debt-to-equity ratio reduction and absolute debt level trends
- Industry demand indicators and farm equipment order backlogs
- Operating cash flow and free cash flow normalization
- Revenue trend and gross margin stability
Deere & Co (DE) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 2.6% FCF margin may limit capital allocation flexibility. The current ratio below 1.0x warrants monitoring of short-term liquidity.
DE Profit Margin, ROE & Profitability Analysis
DE vs Industrial Sector: How Deere & Co Compares
How Deere & Co compares to Industrial sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Deere & Co Stock Overvalued? DE Valuation Analysis 2026
Based on fundamental analysis, Deere & Co has mixed fundamental signals relative to the Industrial sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Deere & Co Balance Sheet: DE Debt, Cash & Liquidity
DE Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Deere & Co's revenue has grown significantly by 39% over the 5-year period, indicating strong business expansion. The most recent EPS of $34.63 reflects profitable operations.
DE Revenue Growth, EPS Growth & YoY Performance
DE Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $12.8B | $1.8B | $6.55 |
| Q1 2026 | $8.5B | $656.0M | $2.42 |
| Q3 2025 | $12.0B | $1.3B | $4.75 |
| Q2 2025 | $12.8B | $1.8B | $6.64 |
| Q1 2025 | $8.5B | $869.0M | $3.19 |
| Q3 2024 | $13.2B | $1.7B | $6.29 |
| Q2 2024 | $15.2B | $2.4B | $8.53 |
| Q1 2024 | $12.2B | $1.8B | $6.23 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Deere & Co Dividends, Buybacks & Capital Allocation
DE SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Deere & Co (CIK: 0000315189)
📋 Recent SEC Filings
❓ Frequently Asked Questions about DE
What is the AI rating for DE?
Deere & Co (DE) has a Combined AI Grade of B from Claude (B) and ChatGPT (B) with 66% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are DE's key strengths?
Claude: Exceptional operating margin of 39.3% reflects strong pricing power and operational efficiency in a challenging environment. Net income growth of 0.6% YoY despite double-digit revenue decline demonstrates margin expansion and cost control capabilities. ChatGPT: Gross margin of 22.8% indicates the core equipment business remains meaningfully profitable despite lower sales. Interest coverage of 12.6x suggests debt service is manageable even with a sizable debt load.
What are the risks of investing in DE?
Claude: Sharp 11.7% revenue decline signals cyclical downturn in farm equipment demand with unclear recovery timeline. Critically weak free cash flow conversion at only 2.6% FCF margin severely limits debt reduction and capital deployment capacity. ChatGPT: Revenue fell 11.7% year over year, pointing to cyclical demand pressure and weaker operating momentum. Operating cash flow of -$890.00M and free cash flow of -$1.15B indicate weak cash conversion in the latest period.
What is DE's revenue and growth?
Deere & Co reported revenue of $23.0B.
Does DE pay dividends?
Deere & Co pays dividends, with $878.0M distributed to shareholders in the trailing twelve months.
Where can I find DE SEC filings?
Official SEC filings for Deere & Co (CIK: 0000315189) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is DE's EPS?
Deere & Co has a diluted EPS of $8.97.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is DE's fundamental grade?
Based on our AI fundamental analysis in June 2026, Deere & Co has a B grade with 66% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is DE stock overvalued or undervalued?
Valuation metrics for DE: ROE of 8.9% (sector avg: 15%), net margin of 10.6% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
What is DE's AI grade for 2026?
Our dual AI analysis gives Deere & Co a combined B grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is DE's free cash flow?
Deere & Co's operating cash flow is $1.0B, with capital expenditures of $451.0M. FCF margin is 2.6%.
How does DE compare to other Industrial stocks?
Vs Industrial sector averages: Net margin 10.6% (avg: 10%), ROE 8.9% (avg: 15%), current ratio N/A (avg: 1.8).