TacticScaleWhat Deere Does & How It Makes Money (DE)
Updated October 2026 · reflects Deere's latest reported financials
Maker of farm, lawn, construction and forestry equipment. Deere makes most of its money selling equipment, attachments and service parts through dealers.
How Deere makes money
Deere makes most of its money selling equipment, attachments and service parts through dealers. It also earns interest and fees by financing and leasing equipment for customers and dealers, and by selling extended warranties.
What Deere does
Deere & Company is a global maker of agricultural, turf, construction and forestry equipment. It reports four segments. Production and Precision Agriculture covers large tractors, harvesters, cotton and sugarcane harvesters, and seeding, tillage and spraying equipment. Small Agriculture and Turf covers utility and compact tractors, hay and forage equipment, utility vehicles, and mowers for homes, businesses and golf courses. Construction and Forestry covers excavators, loaders, dozers, motor graders, dump trucks and log harvesters, plus a wide range of road building equipment such as pavers, milling machines, crushers and asphalt plants. The fourth segment, Financial Services, finances and leases Deere equipment for customers, gives wholesale financing to dealers, and sells extended warranties. This helps drive equipment sales and adds a steady stream of financing income. Deere also partners with Tarter USA to develop and produce flex wing rotary cutters. Founded in 1837, the company is headquartered in Moline, Illinois.
Products & services
- Row crop and four-wheel-drive tractors
- Combine harvesters, cotton pickers and sugarcane harvesters
- Sprayers and precision crop care equipment
- Riding lawn, commercial mowing and golf course equipment
- Excavators, loaders, dozers and motor graders
- Road building equipment including pavers, milling machines and asphalt plants
What is Deere worth?
On an owner-earnings DCF, Deere's most-likely value is about $261 versus a recent price near $621 (58% above fair value). But TacticScale only calls a stock undervalued when the price sits below its conservative no-growth floor (~$150) with a margin of safety — so the honest verdict here is “Fairly priced — no edge.” Fair value earns its keep only at the extremes, not in the wide middle.
Price sits in the normal range — fair value isn't actionable here; it earns its keep only when price drops below the no-growth floor, or runs to roughly double the optimistic case.
⚠ High leverage — net debt is 12.0× annual cash flow. Net debt is subtracted from this fair value, but refinancing at higher rates, principal timing, and share dilution aren’t modeled — the equity can be worth far less if cash flow weakens.
Analysis, not advice. Fair value is a margin-of-safety estimate from a deterministic owner-earnings DCF, not a price target or recommendation. See the full breakdown →
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