Deere & Company (NYSE:DE) reported its Q3 results, with EPS of $6.16 coming in worse than the Street estimate of $6.64. Revenue was $13 billion, slightly better than the Street estimate of $12.96 billion.
For the full 2022-year, the company expects net income to be in the range of $7.0-$7.2 billion.
According to the analysts at Oppenheimer, the revenue beat demonstrated the company's execution in ramping production, while the bottom-line miss and narrowed net income guidance reflected persistent cost inflation.
While execution remains at the fore, the analysts see sustained production rates, strong pricing, and improved raw material cost inflation establishing a favorable backdrop coming into 2023. The analysts believe that despite the later-stage replacement cycle, agriculture represents one of the few end markets positioned for sustained earnings growth in 2023, and is more resilient in a potential recession. The analysts raised their price target on the company’s shares to $415 from $365, while maintaining their Outperform rating.