DE : NYSE : Industrial Goods
$78.17 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 3,258,500
07/28/16 - 4:01 PM ET

Financial Analysis


DEERE & CO's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Sales and net income have dropped, however the growth has outpaced the average competitor within the industry.

During the same period, stockholders' equity ("net worth") has decreased by 12.35% from the same quarter last year.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)7875.48129.7
EBITDA ($mil)1312.01481.6
EBIT ($mil)924.41141.6
Net Income ($mil)495.4690.4


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)4194.24365.4
Total Assets ($mil)59183.359594.0
Total Debt ($mil)37865.837314.5
Equity ($mil)7164.38173.8


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin30.1231.52
EBITDA Margin16.6518.22
Operating Margin11.7414.04
Sales Turnover0.470.55
Return on Assets2.724.32
Return on Equity22.531.52
Debt Q2 FY16 Q2 FY15
Current Ratio0.00.0
Debt/Capital0.840.82
Interest Expense191.1165.5
Interest Coverage4.846.9


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)314.26333.87
Div / share0.60.6
EPS1.562.03
Book value / share22.824.48
Institutional Own % n/a n/a
Avg Daily Volume3070484.03356339.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 24.52 for the Machinery industry and a discount compared to the S&P 500 average of 25.05. To use another comparison, its price-to-book ratio of 3.61 indicates a premium versus the S&P 500 average of 2.81 and a discount versus the industry average of 3.79. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, DEERE & CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
DE 16.54 Peers 24.52   DE 7.29 Peers 16.07

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

DE is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

DE is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
DE 22.40 Peers 21.65   DE NM Peers 3.66

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

DE is trading at a valuation on par with its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

DE's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
DE 3.61 Peers 3.79   DE -32.02 Peers -27.70

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

DE is trading at a valuation on par with its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, DE is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
DE 0.93 Peers 1.63   DE -15.98 Peers -5.12

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

DE is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

DE significantly trails its peers on the basis of sales growth

 

 

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