Stock Analysis | Deere Outlook - Mixed Signals as Technicals Turn Weak and Fundamentals Remain in Question

Market Snapshot

Headline Takeaway: Deere (DE) is under pressure technically with weak momentum and conflicting analyst ratings. The stock is down 4.58% recently, despite a relatively strong cash position and some positive signs in operating cash flow.

News Highlights

• Farm Machinery Industry Eyes Modest Recovery (May 29): The Brazilian Agricultural Machinery Association reported a 12% rise in revenue from November 2024 to February 2025. This suggests a gradual stabilization in the sector, potentially benefitting Deere in the long run, though near-term demand remains a concern.
• Uranium Mining Revival Under Trump (May 31): President Trump's decision to fast-track a uranium mine in Utah hints at renewed interest in the energy sector. While not directly tied to Deere, it signals broader economic and infrastructure activity that could indirectly support agricultural and industrial machinery demand.
• China's Factory Activity Contracts (May 31): China's PMI dropped to 49.5 in May, indicating ongoing factory slowdowns. Given Deere's global exposure, especially in China, this could weigh on its future earnings and reinforce the bearish technical outlook for the stock.

Analyst Views & Fundamentals

Analysts remain divided on Deere’s outlook, with a simple average rating of 4.00 and a performance-weighted rating of 2.84, indicating a generally bearish bias. There are mixed messages from top institutions, with JP Morgan and Baird showing better historical performance than DA Davidson and Truist Securities.

Recent analyst ratings include:

• Neutral from Baird and JP Morgan (both with excellent historical win rates of 83.3% and 100.0%, respectively).
• Strong Buy from DA Davidson and Truist, but both have weaker historical performance (0.0% and 33.3% win rates, respectively).

These mixed ratings do align with the current price trend, which is down 4.58%. Investors appear to be factoring in uncertainty in agricultural and infrastructure demand, especially with global macroeconomic headwinds.

Key fundamental factors and values:

• Revenue-to-Market Value (Revenue-MV): 2.17 (internal diagnostic score: 1/10)
• Enterprise Value-to-EBIT (EV/EBIT): 73.01 (score: 2/10)
• Profit-to-Market Value (Profit-MV): -14.08% (score: 3/10)
• Price-to-Earnings (PE): 90.71 (score: 2/10)
• Return on Assets (ROA): 1.69% (score: 1/10)
• Basic EPS YoY Growth Rate: -33.45% (score: 3/10)
• Long-Term Debt-to-Working Capital Ratio: 0.94% (score: 2/10)
• Cash Flow from Operating Activities (CFOA): 1.60% (score: 2/10)
• Asset-to-Market Value (Asset-MV): 27.23% (score: 1/10)
• Cash-to-Market Value (Cash-MV): -24.22% (score: 3/10)

While Deere’s operating cash flow and revenue-to-market value are positive signs, the poor performance in ROA and earnings growth rate highlights fundamental concerns, especially given the bearish technical backdrop.

Money-Flow Trends

Despite mixed analyst sentiment, big-money flows have been relatively consistent. The overall fund-flow score is 7.68 (good), with block investors showing a negative trend but small-cap retail investors pushing positive inflows. Specifically:

• Large-Inflow Ratio: 48.98% (Large trend: negative)
• Extra-Large-Inflow Ratio: 48.33% (Extra-large trend: negative)
• Small-Inflow Ratio: 50.41% (Small trend: positive)

This pattern suggests that while big investors are pulling back, retail traders are still cautiously optimistic, possibly betting on a near-term rebound or taking advantage of lower prices.

Key Technical Signals

Deere’s technical indicators have turned largely bearish over the past five days, with 3 bearish signals versus only 1 bullish one. The technical score is 3.02 (weak), and the trend is described as volatile with unclear direction.

Recent chart indicators and internal diagnostic scores:

• Williams %R Oversold: bullish bias, score: 7.5/10 (internal diagnostic score)
• Dividend Announcement Date: biased bearish, score: 1.0/10
• Bearish Engulfing: biased bearish, score: 2.15/10
• Bullish Engulfing: biased bearish, score: 1.42/10

The dividend announcement and engulfing patterns are particularly bearish, with the latter indicating strong selling pressure following recent bullish moves.

Recent Indicator Dates:

• 2025-09-03: WR Oversold (bullish)
• 2025-08-25: Bearish Engulfing (bearish)
• 2025-08-27: Dividend Announcement Date + Bullish Engulfing (mixed)
• 2025-08-29: WR Oversold (bullish)
• 2025-08-20: Bullish Engulfing (bearish)

These mixed signals reinforce the weak technical outlook, with bearish candlestick patterns and dividend-related sell-offs overpowering the occasional oversold rally.

Conclusion

Deere is currently in a tricky spot with weak technical signals, mixed analyst ratings, and a modest recovery in the underlying sector. While some fundamentals like operating cash flow and cash-to-market value remain encouraging, the bearish price action and weak technical readings suggest a cautious stance for now.

Actionable Takeaway: Consider waiting for a clearer breakout or a pullback with improved technical confirmation before entering long positions. Keep an eye on the upcoming earnings report and broader macroeconomic data for potential catalysts that could shift the momentum in either direction.