Looking back on agricultural machinery stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including AGCO (NYSE:AGCO) and its peers.
Agricultural machinery companies are investing to develop and produce more precise machinery, automated systems, and connected equipment that collects analyzable data to help farmers and other customers improve yields and increase efficiency. On the other hand, agriculture is seasonal and natural disasters or bad weather can impact the entire industry. Additionally, macroeconomic factors such as commodity prices or changes in interest rates–which dictate the willingness of these companies or their customers to invest–can impact demand for agricultural machinery.
The 6 agricultural machinery stocks we track reported a satisfactory Q2. As a group, revenues missed analysts’ consensus estimates by 0.8% while next quarter’s revenue guidance was 0.8% above.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 8.6% since the latest earnings results.
AGCO (NYSE:AGCO)
With a history that features both organic growth and acquisitions, AGCO (NYSE:AGCO) designs, manufactures, and sells agricultural machinery and related technology.
AGCO reported revenues of $2.64 billion, down 18.8% year on year. This print exceeded analysts’ expectations by 5.9%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS and EBITDA estimates.
AGCO achieved the biggest analyst estimates beat but had the slowest revenue growth of the whole group. Unsurprisingly, the stock is up 2.3% since reporting and currently trades at $109.02.
Is now the time to buy AGCO? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q2: Lindsay (NYSE:LNN)
A pioneer in the field of center pivot and lateral move irrigation, Lindsay (NYSE:LNN) provides a variety of proprietary water management and road infrastructure products and services.
Lindsay reported revenues of $169.5 million, up 21.7% year on year, outperforming analysts’ expectations by 4.6%. The business had an incredible quarter with a solid beat of analysts’ organic revenue and EPS estimates.
Lindsay scored the fastest revenue growth among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $136.37.
Is now the time to buy Lindsay? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q2: The Toro Company (NYSE:TTC)
Ceasing all production to support the war effort during World War II, Toro (NYSE:TTC) offers outdoor equipment for residential, commercial, and agricultural use.
The Toro Company reported revenues of $1.13 billion, down 2.2% year on year, falling short of analysts’ expectations by 2.2%. It was a softer quarter as it posted a significant miss of analysts’ revenue estimates.
As expected, the stock is down 7.9% since the results and currently trades at $74.24.
Read our full analysis of The Toro Company’s results here.
Deere (NYSE:DE)
Revolutionizing agriculture with the first self-polishing cast-steel plow in the 1800s, Deere (NYSE:DE) manufactures and distributes advanced agricultural, construction, forestry, and turf care equipment.
Deere reported revenues of $10.36 billion, down 9% year on year. This result missed analysts’ expectations by 11.8%. Aside from that, it was a mixed quarter as it also recorded an impressive beat of analysts’ EBITDA estimates but a significant miss of analysts’ revenue estimates.
Deere had the weakest performance against analyst estimates among its peers. The stock is down 11% since reporting and currently trades at $456.58.
Read our full, actionable report on Deere here, it’s free for active Edge members.
Alamo (NYSE:ALG)
Expanding its markets through acquisitions since its founding, Alamo (NSYE:ALG) designs, manufactures, and services vegetation management and infrastructure maintenance equipment for governmental, industrial, and agricultural use.
Alamo reported revenues of $419.1 million, flat year on year. This number beat analysts’ expectations by 2.4%. Overall, it was a strong quarter as it also recorded an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ revenue estimates.
The stock is down 17.6% since reporting and currently trades at $185.49.
Read our full, actionable report on Alamo here, it’s free for active Edge members.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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