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Deere & Company shares jump after beating Wall Street's fiscal 2Q revenue projections

Deere’s farm machinery sales in North and South America are holding up well

A Deere tractor
Deere's shares are up in morning trade

Shares in Deere & Company (NYSE:DE) rose after the agricultural heavy equipment maker beat Wall Street's estimate for its fiscal second-quarter revenue on the strength of sales of construction equipment and farm machinery.

Samuel Allen, Deere’s chairman and chief executive, said that Deere’s farm machinery sales in North and South America are looking solid and construction equipment sales are moving sharply higher. But higher raw-material and freight costs are cutting into profits. 

“[These] are being addressed through a continued focus on structural cost reduction and future pricing actions," said Allen.

For the fiscal second quarter, the group reported net income of US$1.208bn, or US$3.67 per share, up from US$808.5mln or US$2.50 per share in the year-ago quarter.

On an adjusted basis, its per-share earnings amounted to US$3.14 per share, which fell short of the Wall Street estimate of US$3.30 per share.

Its revenue, however, came to US$10.7bn, which zipped past the consensus estimate of US$9.8bn.

The company now expects fiscal 2018 revenue of about US$32.62bn, which is less than the consensus estimate of revenue of US$33.35bn.

Deere shares jumped 4% to US$152.81 in morning trade.

Quick facts: Deere & Company

Price: 214.55 USD

NYSE:DE
Market: NYSE
Market Cap: $67.23 billion
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