Deere (NYSE:DE) has recently experienced a decline in its stock following the release of the fourth-quarter earnings report. Although the total revenue and earnings per share surpassed analyst estimates, the outlook for the first quarter of 2024 fell short of expectations, with net income projected between $7.5 – $7.75 billion, compared to analyst projections of $7.83 billion. As a result, Deere’s stock plummeted by over 6%. Deere’s CEO attributed this less-than-expected net income projection to the stabilization of its agriculture product demand compared to strong results in 2022 and 2023.
The agricultural industry is expected to witness slower growth in 2024, potentially causing several stocks within the sector to experience sluggish share price appreciation. However, this may present a favorable buying opportunity for investors interested in venturing into agricultural businesses. Despite Deere’s recent stock price downturn and a poor outlook for Q1 2024, some agriculture companies are perceived as promising long-term investments due to their robust dividend yields.
Alamo Group (ALG)
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Alamo Group (NYSE:ALG), an agriculture management and infrastructure business, is positioned positively within the market, with a range of equipment offerings including tractors, mowers, loaders, snow blowers, street sweepers, snow plows, and cleaning systems for governmental and industrial purposes. Alamo also provides aftermarket and maintenance services. The company has weathered market fluctuations, with its share price remaining in positive territory over the past year. Its acquisition of Royal Truck & Equipment, a company boasting $44 million in revenue, and strong third-quarter earnings that surpassed estimates, including an 18% dividend yield increase to twenty-six cents per share, have boosted investor confidence, propelling its share price upward by 37% over the past year.
CF Industries (CF)
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CF Industries (NYSE:CF) stands as a producer of industrial fertilizer products and has demonstrated stability by providing a decent annual dividend yield of approximately 2.57%. In addition, its fourth-quarter earnings, released on February 14, exceeded analyst expectations with a decline of 40% in total sales primarily due to a drop in average selling prices. Despite this, the company’s share price has remained relatively constant over the past year. CF Industries may offer investors a stable option in the agricultural chemical business, especially with an anticipated increase in demand for fertilizer products.
CNH Industrial (CNHI)
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CNH Industrial (NYSE:CNHI) has experienced a 26% decline in share price over the past year, largely attributed to a weak revenue outlook. However, the company reported a 2% decline in total revenue and a 4% rise in net income for the fourth quarter and full year 2023, with positive news surfacing regarding sales and a projected improvement in margins due to cost-cutting measures. CNH Industrial, though not expected to see significant upside in the near term, presents investors with a buying opportunity that could yield long-term profitability, given its promising cost-cutting strategies and an appealing valuation.
Noah has about a year of freelance writing experience. He’s worked with Investopedia dealing with topics such as the stock market and financial news.
