迪尔公司（DE）：模型更新-低谷论点依然成立

2025E2026E37,901.841,068.8-38,275.340,505.9-18.8321.4718.2022.50 2027E43,916.945,352.525.0225.75 Stephen Volkmann, CFA * | Equity Analyst(212) 284-2031 | svolkmann@jefferies.comChirag Patel * | Equity Associate(212) 284-1773 | cpatel@jefferies.comJosef Nieto * | Equity Associate+1 (212) 778-8495 | snietophillips@jefferies.comJamie Simonson * | Equity Associate+1 (917) 344-1852 | jsimonson1@jefferies.comSource: Company data, AEM, Jefferies The Long View: Deere & CompanyInvestment Thesis / Where We DifferNA Ag fundamentals continue to show weakness, which will likely persistthrough 2025. On the plus side, an increase in global demand from both feedand fuel stock supports a relatively stable pricing backdrop. We anticipatefurther declines globally, though especially in NA Large Ag equipment volumesthrough 2025, with a potential bottoming in the back half of the year. The stepsDE has taken over the past cycle to reduce costs and improve operationsshould support margins, despite the lower volumes. Investments in SaaS andconnected equipment will likely take a while to show any meaningful impact,though the recurring revenue streams should help support sales in futuredown cycles.Base Case,$510, +3%•Global Ag markets are expected to decline lowto mid-teens, with Deere currently forecasting agreater decline in their business due in part toweakness in Brazil.•Total company decremental margin of ~40%,which incorporates higher wage costs offset byimproved operating efficiencies.•CY2025 machinery sales of ~$40bn.•CY2025 EPS: ~$19.50; Target Multiple: ~26.2xP/E; Price Target: $510.Sustainability MattersTop Material Issue(s):1) Ecological Impacts: GHG emissions and fertilizer/pesticide runoffs are knownto cause adverse impacts on the environment surrounding farmlands. DE is focused on improving fueleconomy and reducing input usage for farmers which should help mitigate this impact. 2) Product andLifecycle Management: Parts/service and upgrades are increasingly important to extending the lifespanand capability of equipment.Company Target(s):1) 50% reduction in Scope 1&2 CO2 emissions by 2030 vs 2021 baseline. 2) Reducewater intensity by 10% by 2030 vs 2021 baseline. 3) Reduce waste intensity by 15% by 2030 vs 2021baseline.Qs to Mgmt:1) Can you talk about the cost savings customers can achieve by using precision plantingequipment? 2) Can you talk about what action the board is taking to ensure ESG is a core focus for thecompany? 3) Can you expand on the environmental benefits driven by your new precision agricultureequipment? 4) How is the company adapting to 'right to repair' pressure?Please see important disclosure information on pages 10 - 15 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Upside Scenario,$600, +21%•Better-than-expected corn pricing resultinginhigher farmer income and a renewedconfidence in the upgrade cycle for equipmentgloballyoffset by volume decline in largecombine sales.•Higher wages are more than offset by thebenefits of a normalized supply chain and costactions help to drive a relatively flat marginscenario.•We estimate this scenario would yield earnings~$30.00/shr in CY2025.•Applying a P/E multiple of 20x would imply aPrice Target of $600. Downside Scenario,$325, -35%•Global farm demand fizzles out as weakercommodity prices leading to underinvestmentin equipment for a prolonged period.•Decremental margins in the 35-40% prevailresulting in an earning trough of $20/shr.•Lack of confidence in an upcycle limits multipleprogression over the period resulting in a P/Emultiple of ~16x and a Price Target of $325.CatalystsThe Positives:•World-classproductsoperations; consolidated global industry.•Growing market share in Brazil markets.•Strong cash flow and balance sheet dynamics•Strong cost control through the cycle.The Risks:•NA (~60% of sales) could remain stagnantshould crop prices remain volatile and uncertainfarm income.•NA dealer network could be pressured by adecline in new and used sales. withworld-class2 Exhibit 3 - EBIT Bridge to F2Q25 Results.$2,889(951)$1,500$1,700$1,900$2,100$2,300$2,500$2,700$2,900$3,100Equipment Operations EBIT Bridge ($, mn)Source: Company data, JefferiesExhibit 4 - Deere - Historical EV / Forward EBITDA.5.07.09.011.013.015.017.019.021.023.0Source: Factset, Jefferies estimatesExhibit 5 - Historical Price to NTM Earnings.5.010.015.020.025.030.0Source: Jefferies, FactsetPlease see important disclosure information on pages 10 - 15 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Exhibit 6 - Historical EV / Forward Sales.0%50%100%150%200%250%300%350%400%450%Source: Jefferies, FactsetExhibit 7 - Updated F2025 Outlook.Source: Company presentationPlease see important disclosure information on pages 10 - 15 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Exhibit 8 - DE: Annual Income Statement.($ i