Deere & Co (NYSE: DE) is trading down in premarket on Thursday even though it reported better-than-expected financial results for its second quarter.
Why is Deere stock down on Thursday?
The stock is being hit primarily because the agricultural equipment manufacturer trimmed its guidance for the future. $DE now forecasts its net income to print at about $7.0 billion.
Analysts, in comparison, were at $7.5 billion instead. John C. May – the chief executive of Deere & Co said in a press release today:
We’re proactively managing our production and inventory levels to adapt to demand changes and position the business for the future.
Except for financial services, the New York listed firm took a hit to sales in all of its business segments in Q2. Deere stock is still up nearly 10% versus its year-to-date low.
Watch here: https://www.youtube.com/embed/arvuXtGSGeY?feature=oembed
Notable figures in Deere Q2 earnings release
- Earned $2.37 billion versus the year-ago $2.86 billion
- Per-share earnings also declined from $9.65 to $8.53
- Net sales tanked 12% year-over-year to $15.23 billion
- Consensus was $7.86 a share on $13.29 billion of net sales
Deere & Co paid a quarterly dividend of $1.47 per share, as per its earnings report on Thursday. According to CEO May:
We continue to demonstrate structurally higher performance levels across business cycles and are benefiting from stability in construction end markets amid declining agricultural and turf demand.
Wall Street currently has a consensus “overweight” rating on Deere stock.
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