Agricultural - Machinery · NYSE
Current Price
$557.65
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on Deere & Company with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
Deere & Company manufactures and distributes various equipment worldwide. The company operates through four segments: Production and Precision Agriculture, Small Agriculture and Turf, Construction and Forestry, and Financial Services. The Production and Precision Agriculture segment provides mid-size tractors, combines, cotton pickers and strippers, sugarcane harvesters, harvesting front-end equipment, sugarcane loaders, pull-behind scrapers, and tillage and seeding equipment, as well as application equipment, including sprayers and nutrient management, and soil preparation machinery for grain growers. The Small Agriculture and Turf segment offers utility tractors, and related loaders and attachments; turf and utility equipment, including riding lawn equipment, commercial mowing equipment, golf course equipment, and utility vehicles, as well as implements for mowing, tilling, snow and debris handling, aerating, residential, commercial, golf, and sports turf care applications; other outdoor power products; and hay and forage equipment. This segment also resells products from other manufacturers. It serves dairy and livestock producers, crop producers, and turf and utility customers. The Construction and Forestry segment provides a range of backhoe loaders, crawler dozers and loaders, four-wheel-drive loaders, excavators, motor graders, articulated dump trucks, landscape and skid-steer loaders, milling machines, pavers, compactors, rollers, crushers, screens, asphalt plants, log skidders, log feller bunchers, log loaders and forwarders, log harvesters, and attachments; and roadbuilding equipment. The Financial Services segment finances sales and leases agriculture and turf, and construction and forestry equipment. It also offers wholesale financing to dealers of the foregoing equipment; and extended equipment warranties, as well as finances retail revolving charge accounts. Deere & Company was founded in 1837 and is headquartered in Moline, Illinois.
ROIC (TTM)
7.2%
ROE (TTM)
18.9%
FCF Yield
2.37%
Based on trailing twelve-month data, DE shows a free cash flow per share of N/A and a ROIC of 7.2%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 2.37% are important context metrics when evaluating DE's stock valuation relative to peers.
The intrinsic value of DE depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether DE is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $557.65. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on Deere & Company: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Agricultural - Machinery industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting DE's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Deere & Company, this means projecting how much free cash flow the Agricultural - Machinery will produce over the next 5-10 years, then discounting those amounts to today's dollars. DE's ROIC of 7.2% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For DE, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
