Deere has reduced production and shed thousands of jobs since 2013, most recently last month at an IL operation.
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Deere & Co reported a much smaller-than-expected drop in quarterly profit and raised its fiscal-year outlook as cost controls helped the machinery maker weather the hard agricultural and construction markets. Coming to the earnings surprise, Deere has outpaced the Zacks Consensus Estimate in the trailing 4 quarters with an average beat of around 17.39%.
In pre-market activity on the NYSE, Deere shares were gaining 2.03 percent to trade at $78.50.
The company, best known for its John Deere tractors, has been challenged with falling demand for agricultural equipment as lower crop prices take their toll on the U.S farm income. For the full year, analysts are looking for EPS of $3.87 and revenues of $23.61 billion. Earnings per share, however, increased from past year.
Third-quarter net sales and revenue fell 11% to $6.7 billion, undershooting forecasts of $6.1 billion. The stock has fallen 18 percent in the last 12 months.
Chairman and CEO Samuel Allen said the company’s results “reflected the continuing impact of the global farm recession as well as hard conditions in construction equipment markets”.
Company equipment sales are projected to decrease about 10 percent for fiscal 2016 and be down about 8 percent for the fourth quarter.
He also underscored that all divisions remained profitable, with agriculture and turf reporting higher operating profit than previous year.
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Full-year net income will be $1.35 billion in the year through October, Moline, Illinois-based Deere said Friday in a statement, compared with the $1.2 billion it projected in May. It also produces a variety of commercial and consumer equipment; and a broad range of construction and forestry equipment.
