Deere & Company

(New York Stock Exchange)
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Somewhat Bullish +45

Which Industrials Stock Do Analysts Like Better: Deere or Caterpillar? - Yahoo Finance

AI integration Financial outlook AI-generated analysis

πŸ“ˆ Caterpillar stock has climbed 41% year-to-date in 2026, significantly outperforming Deere's 36% gain and the S&P 500's 14% rise.

πŸ”‹ Caterpillar's power and energy segment sales surged 72% driven by demand from AI data center construction.

πŸ’° Caterpillar reported a massive $72 billion order backlog, representing a 92% increase over the past year.

πŸ“Š Caterpillar's second-quarter revenue climbed 24% to $20.5 billion while adjusted earnings per share soared 73%.

🚜 Deere reported third-quarter revenue growth of 5% reaching $12.6 billion with earnings per share up 7.3%.

πŸ€– Deere launched JD, a new AI assistant that collects data from farm equipment to aid farmers in decision-making.

πŸ“‰ Analysts currently favor Caterpillar over Deere based on price targets showing a 20% premium versus 10% for Deere.

🌾 Deere management predicts the agricultural equipment cycle bottomed out in 2026 with demand expected to rise in 2027.

Bullish Signals
  • Deere stock has climbed approximately 36% year-to-date in 2026, significantly outperforming the broader S&P 500 index which is up 14%.
  • Deere reported a strong third-quarter with revenue increasing 5% to $12.6 billion and earnings per share rising 7.3% to $5.10.
  • Management indicates that 2026 marks the bottom of the agricultural equipment cycle, forecasting demand will rise in 2027.
  • The company is seeing improving trends in early-order programs and increasing customer adoption of advanced technologies across its businesses.
Risk Factors
  • Analysts currently view Caterpillar as a more attractive investment than Deere based on Wall Street price targets, which suggest a 20% premium for CAT versus only 10% upside for DE.
  • The forward story for Deere relies on the prediction that demand will not peak until 2027, implying current growth may be cyclical rather than structural.
Full Analysis
The article compares heavy machinery giants Caterpillar and Deere, noting both have significantly outperformed the S&P 500 in 2026. While Deere has climbed approximately 36% year-to-date, Caterpillar has surged 41%. Analysts currently view Caterpillar as the more attractive investment based on Wall Street price targets, which suggest a 20% premium over its current share price compared to a 10% upside for Deere. Caterpillar is highlighted as an emerging artificial intelligence play, with its power and energy segments driving massive revenue growth. The company reported a 72% surge in sales from its power segment due to high demand from hyperscalers building data centers. This segment contributed to Caterpillar's impressive second-quarter results, where revenue climbed 24% to $20.5 billion and adjusted earnings per share soared 73%. Additionally, the company boasts a $72 billion order backlog that has grown 92% over the past year. Deere also reported strong financials in its third quarter, with revenue increasing 5% to $12.6 billion and earnings per share rising 7.3% to $5.10. Management indicates that 2026 marks the bottom of the agricultural equipment cycle, predicting demand will rise in 2027. The company is also advancing its AI capabilities with the introduction of JD, an AI assistant designed to collect data from farm equipment and assist farmers in decision-making.