Deere Shares Tumble After the Farm Equipment Maker's 2024 Guidance Misses Estimates

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Bill McColl
Bill McColl
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Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time.

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Published November 22, 2023
John Deere tractor

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Key Takeaways

  • Deere's 2024 earnings guidance was short of forecasts, and shares dropped.
  • Demand for Deere products has been hurt by high inflation and interest rates, along with falling commodity prices.
  • The maker of big farm equipment posted better-than-expected quarterly results, boosted by higher prices, although volumes fell.

Shares of Deere & Co. (DE) sank over 3% in early trading Wednesday after the farm equipment maker’s guidance fell short of estimates as high inflation and interest rates cut into demand.

Deere said it expects 2024 profit to be in a range of $7.75 billion to $8.25 billion. Analysts had been looking for more than $9.3 billion.

In its fiscal 2023 third quarter, Deere reported earnings per share (EPS) of $8.26, with revenue down 0.8% from a year ago to $15.41 billion. Both exceeded forecasts.

Sales dropped 6% at its Production and Precision Agriculture unit, and 13% at its Small Agriculture & Turf division. In both, Deere noted it had a decline in volumes, which was partially offset by higher prices.

Along with rising costs, the farm industry is feeling the impact of falling commodity prices. The U.S. Department of Agriculture estimated farm income in 2023 will be down about 23% from the year before. 

With Wednesday's decline, Deere shares have lost about 15% of their value in 2023. 

DE

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  1. Deere & Co. "Deere Reports Net Income of $2.369 Billion for Fourth Quarter, $10.166 Billion for Fiscal Year."

  2. U.S. Department of Agriculture. “2023 Farm Sector Income Forecast.”

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