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If you are wondering whether Deere's share price still reflects good value after a strong run, you are not alone. This piece will help you frame that question clearly.
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The stock closed at US$590.69, with returns of 8.4% over the last 30 days, 26.5% year to date, 24.0% over 1 year, 46.2% over 3 years and 73.0% over 5 years. This naturally raises questions about how much of the story is already priced in.
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Recent attention on Deere has been driven by ongoing interest in capital goods and agriculture related equipment, along with broader conversations about how machinery makers are positioned for long term equipment replacement cycles. This backdrop has kept Deere in focus for investors comparing heavy equipment manufacturers and assessing where valuation gaps might exist.
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Our valuation checks currently give Deere a 2 out of 6 score . Next, we will look at what different valuation methods say about the stock, and then finish with a framework that can help you assess value more clearly than any single model on its own.
Deere scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown .
Approach 1: Deere Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model takes projections of a company's future cash flows and discounts them back to today's dollars, aiming to estimate what the business might be worth right now based on those cash flows.
For Deere, the model used is a 2 Stage Free Cash Flow to Equity approach. The latest twelve month free cash flow is about $3.67b. Analysts provide $ free cash flow projections out to 2029, and Simply Wall St then extends these numbers further. By 2030, projected free cash flow reaches $12.35b, with annual figures between 2026 and 2035 ranging from about $4.28b to $16.43b before discounting. All of these future cash flows are discounted back into today's $ using the model's assumptions.
On this basis, the DCF model arrives at an estimated intrinsic value of around $698.59 per share. Compared to the recent share price of about $590.69, this implies the stock screens as roughly 15.4% undervalued using this method alone.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Deere is undervalued by 15.4%. Track this in your watchlist or portfolio , or discover 47 more high quality undervalued stocks .
Approach 2: Deere Price vs Earnings
For profitable companies like Deere, the P/E ratio is a useful shorthand for how much you are paying for each dollar of earnings. It helps you see, at a glance, how the market is weighing the company's profitability against what it earns today.
What counts as a "normal" P/E will vary with growth expectations and risk. Higher expected earnings growth or lower perceived risk can justify a higher P/E, while slower growth or higher risk tends to pull a fair P/E down.
Deere currently trades on a P/E of 33.14x. That sits above the Machinery industry average of about 27.75x and the peer average of 26.01x. Simply Wall St's Fair Ratio for Deere is 50.39x, which is its proprietary estimate of what a reasonable P/E might be once you factor in things like earnings growth, industry, profit margin, market cap and company specific risks.
The Fair Ratio is more tailored than a simple peer or industry comparison because it tries to align the multiple with Deere's own fundamentals rather than just comparing it with broad group averages.
Since the current P/E of 33.14x is below the Fair Ratio of 50.39x, this framework points to the shares screening as undervalued on this metric.
Result: UNDERVALUED
P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 20 top founder-led companies .
Upgrade Your Decision Making: Choose your Deere Narrative
Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. These are simple stories you build around a company that connect your view of its business to a set of numbers for future revenue, earnings, margins and a fair value. You can then compare that fair value with the current price to flag when you might want to buy or sell.
On Simply Wall St, Narratives sit inside the Community page and are used by millions of investors as an easy tool where each person can plug in their own assumptions. The platform continually refreshes those Narratives when new information comes in, such as Deere's updated 2026 net income guidance of US$4.5b to US$5.0b or analyst estimates that imply fair values ranging from about US$460.00 at the bearish end to about US$793.00 at the bullish end.
For Deere, that means one investor could build a Narrative around a fair value near US$460.00 using more cautious revenue and margin expectations. Another might anchor on a Narrative fair value closer to US$793.00 based on stronger growth and profitability assumptions. You can see exactly how those different stories lead to different numbers rather than relying on a single model.
Do you think there's more to the story for Deere? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include DE .
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
