DE
Deere & Company
Industrials · Farm & Heavy Construction Machinery · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The overall model score of 40.6/100 reflects a company where one strong sub-score — dividend at 18.8/20 — is insufficient to offset very weak growth (2.0/20), poor momentum (3.8/20), and a zero theme score, pulling the composite well below average.
- The profitability sub-score of 13.2/20, while respectable, indicates margins and returns are under pressure from the cyclical downturn, limiting the score's ability to lift the overall composite meaningfully.
- The research label of 'Monitor Only' with a confidence level of 9.0/10 reflects high model certainty that the current filing-derived data does not support a more constructive research stance given the breadth of weak sub-scores.
Why Not Higher
- The growth sub-score of 2.0/20 is the primary constraint on a higher overall score, as year-over-year declines in revenue, net income, and EPS as reported in FY 2025 represent a fundamental deterioration that the model weights heavily.
- A theme score of 0.0/20 means Deere received no credit for macro theme exposure, which — combined with the low momentum score — eliminates two potential avenues through which the composite score could have been meaningfully elevated.
Data Confidence
9 / 10
Very High — full data coverage
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Deere & Company is the world's largest manufacturer of agricultural equipment and a significant producer of construction and forestry machinery, operating under the iconic John Deere brand. The company's FY 2025 10-K filing reveals a business with meaningful profitability credentials — a profitability sub-score of 13.2/20 reflecting solid net and operating margins and return on assets — and a standout dividend sub-score of 18.8/20, indicating strong free cash flow coverage of dividends, a consistent dividend-per-share growth streak, and a healthy FCF payout ratio as derived from regulatory filings. However, the overall model score of 40.6/100 is dragged down materially by weak growth (2.0/20), poor momentum (3.8/20), and a zero theme score, signaling that revenue and earnings growth have stalled or declined year-over-year and that quarterly trends in revenue, earnings, and margins are deteriorating rather than improving in the most recent filing period. The research tradeoff for DE is therefore between a fundamentally solid, dividend-generating industrial franchise and a company currently experiencing a cyclical downturn in its core agricultural equipment market, with no identifiable macro theme tailwinds reflected in the filing data.
Plain English
Deere & Company makes the green-and-yellow farm tractors and construction equipment you see on fields and job sites. The model score of 40.6 out of 100 reflects a company that pays reliable dividends supported by strong free cash flow but is currently going through a rough patch where sales and earnings are shrinking, not growing. The Very High risk rating means the model sees significant uncertainty ahead — driven by cyclical downturns in farm equipment demand and balance sheet leverage — so this is flagged as a 'Monitor Only' research candidate rather than one with near-term positive momentum. Researchers focused on dividend income may find the income-related fundamentals more compelling than the overall composite score suggests.
Bull Case vs. Bear Case
Bull Case
- The dividend sub-score of 18.8/20 — the highest in the model's breakdown — reflects strong free cash flow coverage of dividends, a consistent dividend-per-share growth streak, and a healthy FCF payout ratio as recorded in the FY 2025 10-K, indicating the dividend appears well-supported by underlying cash generation.
- A profitability sub-score of 13.2/20 indicates that despite the cyclical revenue decline, Deere has maintained meaningful net and operating margins and return on assets, consistent with its pricing power and proprietary technology ecosystem in precision agriculture.
- Under the dividend income goal profile, Deere's composite score improves to 56.6, suggesting that for researchers specifically evaluating income-generating industrials, the filing-derived fundamentals present a more favorable picture than the blended 40.6 score implies.
Bear Case
- The growth sub-score of just 2.0/20 signals significant year-over-year deterioration across revenue, net income, and EPS as reported in the FY 2025 10-K, indicating the company is in an active cyclical contraction rather than a period of expansion.
- A momentum sub-score of 3.8/20 reflects worsening quarterly trends in revenue, earnings, and margins within the filing period, suggesting the downturn has not yet stabilized and that near-term fundamental improvement is not evident in the data.
- The financial health sub-score of 8.0/20 points to elevated leverage relative to the model's benchmarks, which becomes a more acute concern in a period of declining earnings when interest coverage ratios are under pressure.
What Could Change the Picture
Bullish Triggers
- A recovery in year-over-year revenue and net income growth in subsequent 10-K filings, translating into a materially higher growth sub-score, would be the most significant data-based signal for improving the research view on Deere.
- Improvement in the quarterly momentum sub-score — reflecting stabilizing or expanding margins and earnings in consecutive quarters within a future filing — would suggest the cyclical trough has passed and the fundamental trajectory is improving.
Bearish Triggers
- Further deterioration in the financial health sub-score in a future filing, particularly if interest coverage metrics weaken materially as earnings decline continues, would represent an incremental negative signal for the research profile.
- Any reduction in dividend-per-share or a significant decline in free cash flow coverage of the dividend — as captured in a future filing's dividend sub-score — would undermine the primary bullish pillar identified in the current model and warrant a downward revision of the research assessment.
Red Flags
- The combination of a near-zero growth score (2.0/20) and a very low momentum score (3.8/20) in the same filing period suggests the cyclical revenue and earnings decline is both significant and ongoing, with no filing-based evidence of a near-term inflection.
- A financial health sub-score of 8.0/20 indicates the balance sheet carries leverage that, when paired with declining profitability trends, warrants monitoring for deteriorating interest coverage metrics in future filings.
- The theme sub-score of 0.0/20 indicates the model identified zero macro theme exposures for Deere in its current filing, meaning the company lacks a structural tailwind narrative — such as AI infrastructure, energy transition, or defense spending — that could offset cyclical headwinds.
Risk Profile
Very High RiskThe Very High risk rating for Deere reflects the combination of a deep cyclical contraction in agricultural equipment demand visible in the FY 2025 filing, elevated balance sheet leverage at a time of declining earnings, and near-zero growth and momentum scores that together signal material fundamental uncertainty in the near term. For an industrial machinery company with significant capital expenditure requirements and exposure to commodity-driven farm income cycles, these factors compound the inherent business cycle risk.
Key Catalysts to Watch
The key variable to monitor is any evidence of a recovery in North American and global agricultural equipment order rates and pricing, which would directly translate into improved revenue and earnings growth metrics in future 10-K filings and drive higher growth and momentum sub-scores. Additionally, any meaningful reduction in leverage or improvement in interest coverage ratios would strengthen the financial health sub-score and reduce the risk profile assigned by the model.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.