Agricultural equipment maker Deere (DE) reported fiscal fourth-quarter earnings that topped estimates, but more importantly gave investors reason to hope the long-struggling farm sector might finally be bottoming out.

Deere reported net income of 90 cents a share for the three months ended Oct. 31, down from $1.08 a year prior but easily beating analysts' expectations by a wide margin. Strong cost discipline was credited for the beat.

The results marked the 16th consecutive quarter that Deere has topped expectations, a remarkable accomplishment given the weakness in the ag sector. U.S. farm income is projected to come in at a seven-year low due to strong crops that have cut into prices, leaving farmers with less cash to invest in new equipment.

More importantly for investors, Deere offered muted optimism going into 2017. The company said it expects equipment sales to decrease by just 1% in fiscal 2017, compared to analysts' predictions of a 3% drop. Deere also said it believes it can generate $1.4 billion in net income for the year, compared to $1.21 billion estimates.

Deere has said it intends to further cut costs by upward of $500 million by the end of 2018.

"John Deere has completed another successful year in spite of continuing weakness in the global agricultural and construction equipment sectors," Chairman and CEO Samuel R. Allen said in a statement. "Our forecast continues to represent a standard of performance that is considerably higher than in earlier downturns."

Shares of Deere reacted positively to the quarter, jumping more than 10% in premarket trading.

The company said that equipment net sales in the U.S. and Canada decreased by 14% year over year for the quarter and 13% for the full year, while outside of those countries net sales increased by 11% in the quarter and were down 3% for the year.

On a segment basis, agriculture and turf sales were down 7% for the year, while construction and forestry fell 18% for the year. Deere said it expects ag sales to fall by about 1% in fiscal 2017, but said construction sales should recover and forestry sales would be flat in the new year.

Deere's optimism is in stark contrast to the view of another heavy equipment maker, Caterpillar (CAT) , who last month took the wrecking ball to 2016 results and warned it doesn't see 2017 coming in much better. Caterpillar, like Deere, has won praise for its efforts to manage costs through a downturn, but its significant exposure to the troubled mining and commodities industries have weighed on results.

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