Shares of Deere (NYSE: DE) gained ground on Friday after the equipment company missed earnings expectations for its fiscal third quarter and lowered guidance for the full year, saying farmers were delaying purchases because of uncertainty around the trade war.
The equipment company reported adjusted earnings of $2.71 per share on $8.97 billion in revenue. Analysts expected $2.85 in earnings per share and $9.39 billion in revenue
The company lowered guidance for the second consecutive quarter, saying it expects a 4% increase in sales and $3.2 billion in net income for the year. In May, the company said it expected a 5% increase in sales and net income of $3.3 billion.
"John Deere’s third-quarter results reflected the high degree of uncertainty that continues to overshadow the agricultural sector," said CEO Samuel Allen.
"Concerns about export-market access, near-term demand for commodities such as soybeans, and overall crop conditions, have caused many farmers to postpone major equipment purchases."
The trade war between the U.S. and China has pressured Deere from multiple directions. The company is sensitive to steel prices for production costs and sells products to farmers, whose crops exports are facing uncertain demand from China.
Equipment sales declined 3% compared with the same quarter last year.
The decline was due mainly to the company’s Agriculture and Turf segment, which saw sales decline 6%.
Shares gained $5.51, or 3.8%, to $149.22
