Deere earnings: Cramer says buy DE shares - just not today

Deere DE shares are extended gains on Thursday morning after the agricultural machinery giant reported better-than-expected financials for its third quarter (Q3).

DE saw its revenue climb 5% on a year-over-year basis to $12.61 billion in Q3 on a $5.1 per share of earnings (EPS), representing a nearly 7% increase from last year.

The solid quarterly performance proved sufficient to get famed investor Jim Cramer excited about Deere stock, though he cautioned against chasing the rally on August 20^th.

Why Cramer is bullish on Deere stock

Cramer’s optimism stems mostly from management’s commentary that the protracted downturn in agricultural machinery is finally reaching its floor.

Deere leadership reinforced on the earnings call that fiscal 2026 marks the bottom of the agriculture equipment cycle.

Cramer highlighted on the latest segment of CNBC that Deere has historically been a conservative, non-promotional management team that rarely paints a rosy picture without a strong reason.

After months of management echoing how tough farm economy conditions were, he views their willingness to call an ag bottom as a monumental inflection point.

Because agricultural cycles operate on extended multi-year horizons – calling the bottom suggests a multi-year path forward will offer sustained recovery and value creation for long-term DE shares’ investors.

Why loading up on DE shares today is not advised

Alongside its quarterly beat, Deere raised the lower end of its full-year guidance – now expecting net income of $4.75 billion to $5.00 billion, up from its prior range of $4.50 billion to $5.00 billion.

Despite these reassuring forward operational indicators, Cramer advised against buying the stock directly during Thursday’s initial 7% spike.

He pointed to broad macro choppy conditions making for an overall “ugly” broader trading day – where chasing sharp single-day spikes often leaves buyers vulnerable to pullbacks.

While Cramer remains convinced the underlying cyclical bottom makes Deere shares a compelling long-term buy, he believes patient investors will likely find better tactical entry points once initial earnings momentum cools off.

How to play Deere after its fiscal Q3 earnings

The broader machinery landscape is showing underlying “signs of stabilization” after prolonged cyclical pressure.

Deere’s order book trends, stabilizing used-equipment inventory levels, and growing adoption of high-margin precision technology are serving as structural tailwinds.

Strength in both Construction & Forestry and Small Agriculture & Turf helped offset localized weakness in Production & Precision Agriculture this quarter.

As interest rate pressures ease and global grain markets normalize, machinery replacement demand is poised to reaccelerate.

Investors looking to build a position in industrial blue chips should keep DE stock on their radar –  waiting for short-term market volatility to offer a more attractive entry point to capture the coming ag upcycle.

Note that Wall Street currently rates Deere at Overweight on average, with price objectives going as high as $812, indicating massive upside potential from here.