Analysts forecast precision agriculture will bring the highest growth among business lines for John Deere.
Eric Greaser, senior analyst at Moody’s, told Reuters that analysts are predicting a 36% year over year increase in revenue for Deere’s precision agriculture segment – indicating Deere’s bet on precision is paying off.
“Pricing has been fantastic, and that can lead to very strong earnings for Deere,” Greaser says.
Like most manufacturers, Deere has struggled to secure parts and raw materials, stalling production of equipment and leading to a sales goal miss in the second quarter of 2022. Ken Wagner, owner of Deere dealer Heritage Tractor, says he’s seen quite a few cancellations of machine orders because Deere couldn’t produce them. Deere company executives told shareholders that supply chain disruptions will last through the year.
However, Deere reported a 25% increase in net sales in its third quarter, reporting a net income of nearly $1.9 billion for the third quarter of 2022. The company revised its full-year earnings outlook to a range of $7 billion to $7.2 billion.