Perhaps as much as any heavily global company you can think of, it's becoming more important to break Deere
But before we do that, let's cast a quick glance in the direction of Deere's $575.2 million -- or $1.32-per-share -- profit for the quarter. Those figures were up about 7% on the net income line from the $537.2 million in the second quarter a year ago. Higher expectations for the period -- more along the lines of $1.36 per share -- resulted in the company's shares taking about a 3.2% hit amid Wednesday's triple-digit market tumble.
As you know from your sojourns down your neighborhood grocery isles, world agricultural prices continue their unceasing climb, leading in part to a 35% quarterly increase in global agricultural equipment sales at Deere. And even more impressive was the group's operating profit jump of 47%. Looking ahead, management expects to at least maintain its active agricultural pace, with about 38% sales growth for the year.
But lest you think everything is coming up roses -- or corn, or alfalfa -- at Deere, sales in the Commercial & Consumer sector dipped by a single percentage point, and its operating profit contribution slid by 28%, based on various types of headwinds, including higher materials costs. Beyond that, the Construction & Forestry unit saw its sales hit by 7% in the quarter, while its operating profit fell approximately 38%.
Clearly, along with other companies with strong agricultural businesses, such as chemicals manufacturer DuPont
Ag isn't Deere's only business, but with the agricultural sector still comprising almost 60% of Deere's total sales, and with ag-related sales expected to remain strong throughout much of the world, Deere clearly isn't a stock deserving of being plowed under.
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