DE Research Update — July 9, 2026
Updated Thesis
Deere & Company operates in the agricultural machinery sector, providing durable equipment critical to farming and construction industries. The business quality is high, supported by a strong 18.3% return on equity and solid gross and operating margins of 35.4% and 18.4%, respectively. However, the stock is currently overvalued, trading approximately 30% above its fair value estimate of $418.72, with a P/E trailing and forward multiple of 33.73 and an EV/EBITDA of 18.97, which is expensive relative to its historical valuation.
The investment grade as of this refresh is C — average business quality. High-tier business, expensive valuation with 29.8% downside to $418.72 fair value
Key Metrics at a Glance
- Revenue growth: +6.7% year over year
- Net margin: 10.2%
- Forward P/E: 33.7x
- Fair value upside: -29.8% to our estimate of $419
Current price: $596.74
These figures reflect our most recent data pull and are one input into a multi-factor valuation framework.
Our 12–18 Month Outlook
Quality companies held over a multi-year horizon benefit from compounding fundamentals and the patience to ride through short-term volatility. Deere & Company remains in our covered universe with a average-quality assessment. We update research when material data changes — earnings revisions, management shifts, or regime changes in valuation — not on every price fluctuation.
Long-term accumulation of quality businesses at fair or better prices is the core of the Patient Accumulator approach. Research updates like this one inform whether to add, hold, or wait for a better zone — not whether to react to short-term price moves.
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