As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the agricultural machinery industry, including Deere (NYSE:DE) and its peers.
Agricultural machinery companies are investing to develop and produce more precise machinery, automated systems, and connected equipment that collects analyzable data to help farmers and other customers improve yields and increase efficiency. On the other hand, agriculture is seasonal and natural disasters or bad weather can impact the entire industry. Additionally, macroeconomic factors such as commodity prices or changes in interest rates–which dictate the willingness of these companies or their customers to invest–can impact demand for agricultural machinery.
The 6 agricultural machinery stocks we track reported a softer Q3. As a group, revenues missed analysts’ consensus estimates by 1.8% while next quarter’s revenue guidance was 11.1% below.
In light of this news, share prices of the companies have held steady as they are up 4.2% on average since the latest earnings results.
Best Q3: Deere (NYSE:DE)
Revolutionizing agriculture with the first self-polishing cast-steel plow in the 1800s, Deere (NYSE:DE) manufactures and distributes advanced agricultural, construction, forestry, and turf care equipment.Deere reported revenues of $9.28 billion, down 32.8% year on year. This print was in line with analysts’ expectations, and overall, it was an exceptional quarter for the company with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.
Deere delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 5.3% since reporting and currently trades at $426.50.
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Lindsay (NYSE:LNN)
A pioneer in the field of center pivot and lateral move irrigation, Lindsay (NYSE:LNN) provides a variety of proprietary water management and road infrastructure products and services.Lindsay reported revenues of $155 million, down 7.3% year on year, outperforming analysts’ expectations by 6.5%. The business performed better than its peers, but it was unfortunately a mixed quarter with a solid beat of analysts’ EPS estimates but a significant miss of analysts’ adjusted operating income estimates.
Lindsay scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 11.3% since reporting. It currently trades at $126.95.
Weakest Q3: Titan International (NYSE:TWI)
Acquiring Goodyear’s farm tire business in 2005, Titan (NSYE:TWI) is a manufacturer and supplier of wheels, tires, and undercarriages used in off-highway vehicles such as construction vehicles.Titan International reported revenues of $448 million, up 11.5% year on year, falling short of analysts’ expectations by 5%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
Titan International delivered the fastest revenue growth but had the weakest full-year guidance update in the group. The stock is flat since the results and currently trades at $7.36.
The Toro Company (NYSE:TTC)
Ceasing all production to support the war effort during World War II, Toro (NYSE:TTC) offers outdoor equipment for residential, commercial, and agricultural use.The Toro Company reported revenues of $1.08 billion, up 9.4% year on year. This print lagged analysts' expectations by 1.3%. Overall, it was a disappointing quarter as it also recorded full-year EPS guidance missing analysts’ expectations.
The stock is down 4.3% since reporting and currently trades at $81.61.
AGCO Corporation (NYSE:AGCO)
With a history that features both organic growth and acquisitions, AGCO (NYSE:AGCO) designs, manufactures, and sells agricultural machinery and related technology.AGCO Corporation reported revenues of $2.60 billion, down 24.8% year on year. This number lagged analysts' expectations by 10.4%. It was a disappointing quarter as it also recorded full-year revenue and EPS guidance missing analysts’ expectations significantly.
AGCO Corporation pulled off the highest full-year guidance raise but had the weakest performance against analyst estimates among its peers. The stock is down 3% since reporting and currently trades at $94.86.
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This content was originally published on Stock Story
