The Rising Influence of Rising Affluence

[DewDiligence]

DE logs record quarter, but shares fall 5% because expectations were so high:

http://www.sec.gov/Archives/edgar/data/315189/000110465913041703/a13-12212_1ex99d1.htm

There are two things here for worrywart investors to worry about:

• Although DE maintained FY2013 implicit EPS guidance of $8.40* (+10% vs FY2012 actual EPS of $7.43), it didn’t raise the EPS guidance for the FY2013 (ending 10/31/13).

• DE cut the FY2103 YoY growth outlook for equipment sales from 6% to 5%. (“Equipment sales” exclude DE’s revenue from the captive finance subsidiary.)

I’ve often used DE selloffs to accumulate more shares (e.g. #msg-85908037 two months ago) because, absent a global economic collapse, DE is almost certain to continue to make more and more money. (See #msg-60344244 for DE’s LT outlook, which I find plausible.)

DE FY2Q13 CC slides:
http://www.deere.com/en_US/docs/Corporate/investor_relations/pdf/financialdata/reports/2013/2013_secondquarter_confcallslides.pdf

*$3.3B net income based on 393M diluted shares.