What to Expect When Deere (DE) Reports Earnings Tomorrow

NEW YORK (TheStreet) --Deere & Co. (DE) is scheduled to release its 2015 second quarter earnings results before the market open on Friday morning. Analysts are expecting the tractor, riding mowers, and farming equipment manufacturer and seller to post a year-over-year decline in earnings and revenue for the quarter ended April 2015.

The company has been forecast to report earnings of $1.55 per share on revenue of $7.53 billion for the most recent quarter.

Last year, Deere said it earned $2.65 per share on net sales of $9.95 billion for the 2014 second quarter. The company's year-ago earnings results had declined from the same period in the prior year's second quarter.

Shares of Deere are up by 0.35% to $89.29 in late morning trading on Thursday.

Separately, TheStreet Ratings team rates DEERE & CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate DEERE & CO (DE) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, notable return on equity and increase in stock price during the past year. We feel its strengths outweigh the fact that the company has had somewhat weak growth in earnings per share."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has increased to -$510.10 million or 31.64% when compared to the same quarter last year. In addition, DEERE & CO has also vastly surpassed the industry average cash flow growth rate of -31.77%.
  • DE, with its decline in revenue, slightly underperformed the industry average of 10.5%. Since the same quarter one year prior, revenues fell by 16.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • In its most recent trading session, DE has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Machinery industry and the overall market, DEERE & CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for DEERE & CO is currently lower than what is desirable, coming in at 32.63%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 6.05% trails that of the industry average.
  • You can view the full analysis from the report here: DE Ratings Report

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