Deere (NYSE:DE) has successfully maintained its place in TipRanks’ “Perfect 10” Smart Score list over the past four months. TipRanks’ Smart Score tool considers eight different factors, including analyst rating, technical analysis, and insider activity, among others, and assigns a score to stocks between 1 and 10, with 10 being the best.
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Interestingly, the stocks with the “Perfect 10” score have historically surpassed the returns of the benchmark index. This is evident in the 30.5% gain of DE stock over the past three months in comparison to the 5.8% rally of the broader S&P 500 index (SPX). The stock has gained 25.1% over the past year.
Here’s Why DE Still Carries a “Perfect 10” Score
Deere manufactures and distributes various types of equipment that is used in agriculture, construction, forestry, and turf care.
The robust demand for agricultural products and elevated crop prices have been encouraging farmers to purchase new equipment, thereby aiding Deere’s topline.
The company reported a strong fiscal fourth quarter, as both revenue and earnings increased year-over-year. The company benefitted from easing supply chain woes and robust demand for its products.
Also, Deere’s capital deployment activities are impressive. Earlier in December, the company increased its quarterly common stock dividend by 6%, to $1.20 per share.
Furthermore, the stock seems undervalued despite the share price gain. Its current P/E multiple of 18.7x is trading at a discount of 14.2% to its five-year average of 21.9. This makes DE stock an attractive investment option.
Should You Buy DE Stock?
Deere stock has a Moderate Buy consensus rating based on 11 Buy and six Hold recommendations. Further, the average price target of $476.65 implies 9.2% upside potential.
Besides for analysts, hedge funds have maintained a positive outlook on DE stock. Our data shows that hedge funds bought Deere for 3.4 million in the last quarter. Bloggers are bullish on the stock as well.
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