Al Root

The farming business appears to have bottomed out, offering good news for equipment makers AGCO and Deere.

On Thursday, AGCO reported earnings per share of $2.17 from sales of $2.9 billion. Wall Street was looking for earnings per share of $1.86 from sales of $2.7 billion. A year ago, AGCO reported EPS of $1.97 from sales of $2.9 billion.

"AGCO delivered strong fourth quarter results, achieving an adjusted operating margin of 10.1% reflecting the team's ability to deliver despite ongoing pressures on farm income and global trade dynamics that influenced overall industry activity," said CEO Eric Hansotia in a news release. "Our full-year adjusted operating margin of 7.7% was nearly double the performance recorded at the bottom of the last cycle."

Sales at AGCO and Deere have fallen for the past couple of years as farm incomes have declined amid lower commodity prices and cost pressures. Tractor sales in North America were down 10% in 2025, according to AGCO's data. Sales of combines, machines that reap, thresh, and clean, were down 27%.

Now, growth is expected to return. AGCO projects 2026 sales of between $10.4 billion and $10.7 billion, compared with the 2025 total of $10.1 billion.

Earnings per share are expected to be between $5.50 and $6, while the consensus calls on Wall Street are for EPS of $5.87 from sales of $10 billion. That forecast sounds like a disappointment -- the midpoint of the range of earnings forecasts is below the Street's call -- but AGCO is conservative in telling investors what to expect. The midpoint of its initial range of forecasts for 2025 was $4.25, but EPS came in at $5.28.

Shares were up 3.6% at $126 in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were down 0.7% and 0.4%, respectively.

Deere stock might be getting a little help from AGCO earnings. It was up 0.4% in premarket trading at $569.60. An improving outlook for 2026 will help all the businesses selling to farmers.

Coming into Thursday trading, AGCO stock was up about 18% over the past 12 months. Deere stock was up about 21%.

Write to Al Root at allen.root@dowjones.com

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February 05, 2026 09:13 ET (14:13 GMT)

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