Deere earnings preview: Low expectations for Q4


Deere & Co. (DE), maker of the iconic John Deere tractor, is scheduled to discuss its fiscal fourth-quarter 2009 financial results in a conference call Wednesday, November 25, at 10:00 AM ET, hosted by Chief Financial Officer Jim Field. You can catch the live webcast of the call on the company's website.

During the three months that ended in October, Deere planned to invest in Russia, reached a tentative agreement with the UAW and announced some layoffs. Analysts surveyed by Thomson Reuters expect the agricultural equipment maker to report that earnings for that period plunged from $0.81 per share a year ago to $0.03 per share. And revenue for the quarter is expected to be 34.1% lower to $4.4 billion.

For the full year, the forecast is for $2.61 per share (-44.5%) on $20.40 (-21.0%). Deere's earnings topped analysts' expectations in the past two quarters, by 74 cents per share in the third quarter.

The long-term EPS growth forecast for this Moline, Ill.-based dividend payer is only 9.2%, which is less than that of competitor Caterpillar Inc. (CAT). Yet the First Call consensus recommendation remains to buy DE, with a mean price target of $52.56. Zacks feels the low expectations could offer room for an upside surprise, and Morgan Stanley upgraded Deere, citing increasing demand.

Shares have climbed more than 15% in the past three months and are trading near the 52-week high.

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