Market News & Headlines >> Deere Raises Profit Forecast Again
Deere & Co. on Friday raised its full-year sales and profit forecast for the second time, amid improving demand for its farm and construction equipment, particularly in South America.
The news sent the price of Deere stock soaring by 8.5% to a record high of $122.24 per share in Friday trade, before backing off slightly.
The company said it expected fiscal 2017 growth in industry sales of tractors and combined harvesters in South America to be at the high end of its earlier forecast of about 15-20%, buoyed by improving economic conditions in Brazil and Argentina.
Deere raised its fiscal 2017 equipment sales growth forecast to 9% from a previous forecast of 4%. The company said it now expects its fiscal 2017 net income to be about $2 billion, up from $1.5 billion estimated previously. Deere reported its net income rose 62% to $802.4 million, or $2.49 per share, in the second quarter ended April 30, helped by higher shipments, improved pricing and cost cuts.
Deere's sales had previously taken a substantial hit as big grain and soybean harvests drove down prices, leaving farmers with less cash to spend on equipment. Deere’s global net sales and other revenue fell by nearly 30% between 2013 and 2016.