"You can tell my arms go back to the farm" -- Achy Breaky Heart, Billy Ray Cyrus

Back in the dark days of 2001, John Deere's (NYSE:DE) chairman's message in the annual report glumly announced: "Truly, the John Deere Experience, which we aspire to take to even higher levels for customers and employees, has come up short for investors." A lot has changed since then.

The 2001 loss of $64 million was followed by $319 million of net income in 2002 -- and that was doubled to $643 million in 2003. Were loyal shareholders about to get dumped? No, this isn't a sad, achy breaky heart, "Dear John" letter. Go to Ford (NYSE:F) for that. Deere more than doubled net income in fiscal 2004, which ended October 31.

The stock closed 2001 at $43.66 and then hit an all-time high of $74.93 in April of 2004. But the story gets even better. At today's $69.50, the stock is trading at 12.7 times trailing earnings. Competitor Caterpillar (NYSE:CAT) trades for 17 times earnings -- close to the 16 times earnings peers in the construction and agricultural machinery industry average. Deere is hardly dearly priced!

What John Deere has done since 2001 is innovate. For example, in the spring of 2003, the company introduced lawn tractors for sale at its dealers and Home Deport (NYSE:HD).

The doubling of earnings is not going to continue, alas. Although in a very cyclical business, the company sees 2005 revenues increasing 2% to 7% and earnings of $1.5 billion, up 7% from 2004. That earnings forecast works out to $5.93 a share (based on 253.1 million shares), which is far above the $5.74 a share mean estimate for the 17 analysts who follow the company.

The company's full-year estimates might even prove conservative. Deere expects first-quarter sales to surge 20% to 25% and net income to rise from $200 million to $225 million -- up nicely from net income of $171 million in last year's first quarter.

Deere is harvesting a long-predicted recovery in the machinery business. Strong commodity prices are leading to strong equipment sales, which allow the company to produce bountiful amounts of free cash flow. Falling commodity prices will always be a worry for those with Dear John tendencies. But those buying the stock are not paying a dear price for Deere.

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Fool contributor W.D. Crotty owns stock in Home Depot and, from his country location, sees lots of green and yellow John Deere equipment and mailboxes.