Deere (DE) is back in the spotlight after announcing a manufacturing partnership with Tarter USA to produce American-made Frontier Flex Wing Rotary Cutters, a move tied to strong early dealer demand and field-tested performance.

The new Tarter partnership comes as Deere’s share price trades at US$575.71, with a strong 90 day share price return of 23.5% and a 1 year total shareholder return of 35.7%, pointing to momentum that has built rather than faded.

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With Deere trading at US$575.71 after a 23.5% 90 day share price return and a 35.7% 1 year total shareholder return, plus a value score of 2 and an indicated intrinsic discount, is there still a buying opportunity here, or is the market already pricing in future growth?

Most Popular Narrative: 13.2% Undervalued

Deere’s most followed narrative places fair value at about $663.51 per share, compared with the latest close at $575.71, which frames the current rally as still short of that narrative estimate.

Rapid adoption of Deere's precision agriculture and automation solutions (e.g., JDLink Boost, Precision Essentials bundles, See & Spray tech, and new automation features) is driving higher-value product sales and increased software engagement globally. This is positioning Deere to benefit from shifts toward high-efficiency, technology-enabled farming, which the narrative states will lift both future revenue and net margins through higher-margin recurring software and data services.

Analysts behind this narrative are baking in steadier revenue, a meaningful lift in profitability, and a richer earnings profile that they argue backs up that higher fair value. They link it to a specific earnings path, a higher margin mix, and a valuation multiple usually reserved for faster growing machinery names.

Result: Fair Value of $663.51 (UNDERVALUED)

However, this hinges on tariffs and trade costs not becoming more burdensome than expected, and on North American large ag demand avoiding a deeper, longer slump than analysts model.

Another View: Market Multiple Sends a Different Signal

Analysts using fair value models estimate that Deere is trading 16.1% below their valuation. At the same time, the market is already paying a P/E of 32.3x compared with 26.2x for the US Machinery industry and 24.2x for peers. The fair ratio of 40.2x indicates potential for further movement in the valuation, but it also highlights the question of how much valuation risk individual investors may be willing to accept.

Next Steps

Given the mixed messages on valuation and expectations, this is a good time to review the underlying data yourself and act before sentiment shifts again. A useful starting point is the 2 key rewards and 1 important warning sign.

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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.