Earnings Previews: Deere, Dell, HP, Nordstrom
The holiday-shortened week got off to a quiet start when lightly covered but heavily traded Meten missed its revenue estimate by about 10% and posted an adjusted net loss that was 365% worse than the year-ago loss. In addition to getting into cryptocurrency mining, the company said it is exploring “opportunities related to Metaverse.”
After markets close Monday, Zoom Video will be reporting quarterly results. Our preview of Zoom is included with previews on Medtronic and Xpeng, two of five companies reporting results before Tuesday’s opening bell. The other firms reporting results Tuesday morning are retailers Best Buy, Dick’s and Dollar Tree.
Here are previews of three firms reporting results after markets close on Tuesday and one reporting results before the opening bell on Wednesday.
Heavy equipment maker Deere & Co. (NYSE: DE) has seen a share price gain of around 35% over the past 12 months. A month-long strike was settled last week (the company’s first in 35 years) when the United Auto Workers agreed to a six-year deal that raises pay and boosted benefits.
One thing to keep an eye on going forward is how the company fares under the Biden administration’s right-to-repair order signed in July. As recently as last month at a meeting in Montana, lobbyists and state legislators met to support equipment makers like Deere that are seeking to grow their services businesses by denying farmers the right to make repairs to their own equipment. A recent decision by Apple to allow some owner repairs to certain iPhone models addressed the same issue. Deere reports results before markets open Wednesday.
Analysts remain bullish on the stock, with 13 of 23 giving the shares a rating of Buy or Strong Buy and eight more rating the stock at Hold. At the recent price of around $346.40, the upside potential based on a median price target of $408.75 is 18%. At the high price target of $480, the upside potential is about 38.5%.
For the company’s fiscal fourth quarter that ended in October, analysts expect Deere to report revenue of $10.57 billion, which would be up 1.5% sequentially and up 22% year over year. Adjusted earnings per share (EPS) are expected to come in at $3.87, down 27% sequentially but nearly 62% higher year over year. For fiscal 2021, EPS are forecast is $18.75, up more than 115%, on sales of $39.96 billion, up about 28%.
Deere’s share price to earnings multiple for fiscal 2021 is 18.6. For fiscal 2022, the multiple to estimated EPS of $21.71 is 16.1, and for 2023, it is 14.5 times estimated EPS of $24.04. The stock’s 52-week range is $250.54 to $400.34. Deere pays an annual dividend of $4.20 (yield of 1.21%). Total shareholder return for the past year is 36.7%.
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