Stock Analysis | Deere Outlook - Mixed Signals Amid Weak Technicals and Divergent Analyst Views

1. Market Snapshot

Takeaway: Deere (DE) is under pressure with a recent price drop of -2.44%, while technical indicators remain bearish. Analyst ratings are split, and key fundamental metrics like earnings per share growth are negative.

2. News Highlights

• May 29 - Farm Machinery Industry Eyes Modest Recovery

Sales in the agricultural equipment sector, which Deere dominates, are showing early signs of stabilization after falling in 2024. Brazil’s CSMIA reported a 12% revenue rise from November 2024 to February 2025. If this trend continues, it could offer Deere a tailwind.

May 22 - Titan Machinery Earnings Beat Hints at Sector Optimism

Titan Machinery (TITN) reported better-than-expected Q1 2025 earnings, with comments from analysts indicating OEM partners are preparing initiatives to boost demand in the second half of the year. This could indirectly benefit Deere, as demand in the farm equipment space picks up.

May 31 - China’s Factory Activity Shows Signs of Improvement

China’s PMI rose to 49.5 in May from 49.0 in April, signaling a modest recovery. Although still below 50, this improvement may eventually support global machinery demand, including for Deere, which operates globally.

3. Analyst Views & Fundamentals

Analyst Ratings: The average analyst rating is 4.00, while the performance-weighted rating is 2.84, indicating a bias toward underperformance. Recent ratings are split, with two “Strong Buy,” one “Buy,” and two “Neutral” calls.

• Analyst Consistency: Analysts are not aligned — there are divergences in recommendations and historical performance. Some analysts, like Tami Zakaria (JP Morgan), have strong historical records (83.3% win rate), while others like Michael Shlisky (DA Davidson) have zero success in recent predictions.
• Price Trend Alignment: The current price is falling (-2.44%), and analyst sentiment is neutral to bearish — the two are broadly aligned.

Key Fundamental Values:

• PE Ratio: 90.71 (internal diagnostic score: 3.0)
• EV/EBIT: 73.01 (internal diagnostic score: 3.0)
• Basic Earnings Per Share (YoY Growth Rate %): -33.45% (internal diagnostic score: 2.0)
• Diluted Earnings Per Share (YoY Growth Rate %): -33.38% (internal diagnostic score: 2.0)
• Interest Coverage Ratio (%): 3.00% (internal diagnostic score: 3.0)
• Cash-UP: 24.13% (internal diagnostic score: 4.0)
• Asset-MV: 27.23% (internal diagnostic score: 1.0)
• Profit-MV: -14.08% (internal diagnostic score: 1.0)
• CFOA: 1.60% (internal diagnostic score: 3.0)
• Revenue-MV: 3.29% (internal diagnostic score: 3.0)

4. Money-Flow Trends

Big money is on the sidelines as Deere’s fund-flow pattern shows an overall negative trend, with large and extra-large investors seeing inflow ratios below 50% (49.11% and 48.48%, respectively). In contrast, small investors show a positive trend, with inflow ratio of 50.44%, suggesting retail optimism amid bearish institutional sentiment. This divergence could signal market indecision or an early retail buying opportunity.

5. Key Technical Signals

Technical Score: Deere’s internal technical analysis scores a weak 3.2, with three bearish and one bullish indicator over the past five days. Here’s a breakdown of key signals:

• WR Oversold – Internal diagnostic score: 7.5 (bullish bias, historically leading to 1.53% returns with a 61.54% win rate)
• Dividend Announcement Date – Internal diagnostic score: 1.0 (bearish bias, with -3.55% average return and 0% win rate)
• Bearish Engulfing – Internal diagnostic score: 2.9 (neutral bias, historically yielding 1.07% returns at 41.67% win rate)
• Bullish Engulfing – Internal diagnostic score: 1.4 (bearish bias, with -0.34% average return and 36.36% win rate)

Recent Chart Patterns (by date):

• 2025-09-03: WR Oversold (bullish signal)
• 2025-08-25: Bearish Engulfing (bearish signal)
• 2025-08-27: Dividend Announcement Date & Bullish Engulfing (mixed signals, bearish overall)
• 2025-08-20: Bullish Engulfing (bearish in context)

Key Insight: The technical outlook remains weak, with more bearish signals than bullish ones. Investors are advised to avoid or closely monitor the stock due to the lack of clear momentum and conflicting patterns.

6. Conclusion

Actionable Takeaway: While fundamentals show mixed performance and technicals remain bearish, the recent retail buying interest and a strong WR Oversold pattern could signal a potential short-term bounce. However, with institutional money flowing out and bearish indicators dominating, it may be prudent to wait for a clearer trend before entering or adding to a position in Deere (DE). Keep a close eye on the next earnings report and any developments in the farm machinery sector for directional cues.