Shares of Deere & Company (NYSE:DE) tumbled in premarket trade Wednesday after the agricultural machinery company posted fiscal fourth quarter earnings that missed Wall Street estimates despite strong revenues.
The Moline, Illinois-based company posted earnings of $2.30 per share on revenue of $9.42 billion. The consensus earnings estimate was $2.44 per share on revenue of $8.6 billion.
“In the fourth quarter, farm machinery sales in the Americas made further gains while construction-equipment sales continued to move higher, helped in part by our Wirtgen road-building business, whose financial contribution has exceeded our original forecasts,” Deere & Company CEO Samuel R. Allen said in a statement.
The company said that it was still pressured by rising raw-material costs, especially in steel. President Trump’s trade war with China has pushed the costs for steel and aluminium.
“The company has continued to face cost pressures for raw materials such as steel, which are being addressed through pricing actions and ongoing cost management," disclosed Allen.
For the fiscal year 2019, the world’s largest tractor maker expects net sales and revenue to grow by about 7% while it expects a profit of about $3.6 billion. The company said it expects fiscal 2019 revenue of approximately $35.7 billion. The current consensus estimate is revenue of $36.0 billion for the year ending October 31, 2019.
The stock was down 4.7% to $132 before the opening bell.
Contact Uttara Choudhury at [email protected]