Deere & Co. (NYSE:DE) announced its first quarter earnings report for this year. The company made 1.12 dollars upon revenue of 6.38 billion whereas last year the company made 1.81 dollars EPS on revenue of 6.95 billion dollars. Deere & Co. (NYSE:DE) was ahead of the market consensus; market had forecasted that the company wouldn’t make many sales because the demand for agricultural equipment will be low in 2015. It’s true but the sales of the company weren’t crucially low, on the other hand they were way better than what market had forecasted.
But now the future seems much brighter for Deere & Co. (NYSE:DE) as the demand will grow in the oncoming months and the company will get its chance to make a substantial business. Even the market suggests that Deere & Co. (NYSE:DE) will outperform expectations and will make a healthy profit. Deere & Co. (NYSE:DE)’s profit fell by 40 percent on all fronts because of the low demand but it is expected that the demand for agricultural equipment will increase in the next few months and then things will be back to normal for Deere & Co. (NYSE:DE).
The CEO of the company acknowledged that agricultural scenario of the country has been deteriorating which affected Deere & Co. (NYSE:DE). The demand for equipment has been low and hence companies like Deere & Co. (NYSE:DE) have been finding it hard to make business amidst the draught. Investors of the agricultural equipment companies have been left scratching their heads, planning the next move after the plummeting demand for the products (equipment). Considering the fact that there is still hope; that the demand for equipment will increase, investors are still sticking to Deere & Co. (NYSE:DE)’s stock hoping that things will turn around for the company.
Deere & Co. (NYSE:DE) has been in the agriculture business for quite some time and has built a reputation of one of the largest agriculture equipment provider in U.S. It rolls out billions of dollars every quarter and makes considerable business that receives much attention from investors. Investors are optimistic that Deere & Co. (NYSE:DE) will turn things around in the upcoming months because the company has a past record of making strong profits and making the shareholders happy.
Shareholders will be satisfied if Deere & Co. (NYSE:DE) rolls out a strong quarter, or perhaps two of them to stabilize things, financially. Financial stability can be followed by expansion and other plans. The company must spare some time to think about the alternatives if the demand stays low. Also it will have to find a client or two for a contract so that at least its equipment keeps selling rather than waiting for the market demand to increase.
The best thing would be to sign independent contractors or small companies in need of such equipment. That would be a great case scenario for Deere & Co. (NYSE:DE) right now after the fact that the company has been relying too much on the market demand, which is risky.
