Big green money machine hopes to reap global profits

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Reference no: EM131428902

Case Study: Deere & Company

Article in Better Investing

November 2012

STOCK TO STUDY Featured Company

The Big Green Money Machine Hopes to Reap Global Profits

Deere & Company

  • What factors do you see driving Deere's future revenue and earnings growth? What are some of the risks that could adversely impact future growth?
  • The decomposition of the return on equity (ROE) for Deere is shown on one of the exhibits. Briefly compare the three component ratios to the industry averages, and comment on the quality of Deere's ROE. What is one possible reason ( a particular transaction) why Deere's ROE is so much higher than the industry average?
  • How did Deere enhance shareholder value during fiscal year 2012 in terms of its uses of free cash flow?
  • On the spreadsheet "Deere and Competitors," compare the P/E ratios for Deere and Toro Co. Why do you think Deere has a lower P/E multiple on both current and next year's earnings?
  • Examining the financial statements and ratios for Deere, do you detect any deterioration in the balance sheet and cash flow from 2011 to 2012? Explain.

Reference no: EM131428902

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