Our recent article, Deere unveils new combine harvester with ‘expanded advanced automation’, became one of our most-read pieces in the past few months.
This probably underscores a strong public interest in the intersection between agricultural tradition and cutting-edge technology that is capturing the attention of both farmers and, increasingly, investors.
Deere & Co. (DE), listed on the New York Stock Exchange (NYSE), currently trades around $481. As of early May 2025, its market capitalization stands at approximately $130-131 billion.
Over the past two years, Deere’s share price has seen notable fluctuations. After a period of strong growth, reaching a 52-week high of over $515 in February 2025, the price has experienced some volatility but remains significantly higher than its 52-week low of around $340 in August 2024, indicating a generally upward trend over the longer term.
This sector isn’t just about bigger, greener machines anymore; it’s about a fundamental shift in how food is produced, and Deere says it is positioning itself at the forefront of this revolution.
The combine harvester itself was a transformative invention, largely coming into widespread use in the early to mid-20th century, dramatically increasing the efficiency of grain harvesting and reducing the reliance on manual labor. Now, nearly a century later, we stand at the cusp of another potential revolution: autonomy.
Deere’s latest advancements suggest a future where these colossal machines navigate fields with minimal direct human control, raising profound questions about productivity, efficiency, and the very nature of farming itself.
The autonomous combine: A driverless revolution?
While the term “driverless” evokes images of empty cabs, Deere’s vision for the autonomous combine likely involves a different kind of role for the human operator. Instead of hands on the wheel and eyes constantly scanning the field, the operator transitions to a more supervisory role.
Imagine a scenario where a farmer manages a fleet of autonomous harvesters from a central interface, monitoring their progress, adjusting parameters based on real-time data, and potentially focusing on other crucial tasks such as logistics, quality control, or even financial management.
Deere is equipping these advanced machines with a suite of technologies to facilitate this new paradigm. Sophisticated GPS and sensor systems allow for precise navigation and obstacle detection. Advanced data analytics provide real-time insights into yield, grain quality, and machine performance.
In-cab interfaces are becoming increasingly sophisticated, resembling mobile command centers that allow operators to visualize data, adjust settings remotely, and communicate with other farm systems.
The “driver” of the future combine might spend their time analyzing data on a tablet, optimizing harvesting routes on a computer, coordinating grain transport logistics via phone or digital communication, or even managing the farm’s accounts – tasks that contribute directly to the overall efficiency and profitability of the operation.
The financial implications of Deere’s technological leap
For investors, Deere’s aggressive push into automation and autonomy presents a compelling narrative. This technological leadership could translate into several key financial benefits:
- Increased market share: By offering cutting-edge, efficiency-boosting technology, Deere can attract farmers looking to optimize their operations and potentially gain market share from competitors lagging in automation.
- Higher profit margins: Advanced features and integrated software solutions can command premium pricing, leading to improved profit margins on equipment sales. Furthermore, the development of subscription-based services for data analytics and fleet management could create recurring revenue streams.
- Long-term growth potential: As the global population continues to grow and the demand for food increases, the need for efficient and productive agriculture will only intensify. Deere’s leadership in automation positions them to capitalize on this long-term trend.
The right to repair: A potential headwind?
However, Deere’s path isn’t without potential challenges. One significant issue that has garnered increasing attention is the “right to repair” movement.
Farmers are increasingly vocal about their desire to be able to repair and maintain their own equipment, or choose independent repair shops, rather than being locked into Deere’s authorized service network.
Deere argues that restricting access to their software and technical information is necessary to protect their intellectual property, prevent damage caused by unauthorized repairs, and ensure the safety and proper functioning of their complex machinery. Their aftersales service and proprietary diagnostic tools are also a significant revenue stream.
The financial implications of the right to repair movement are complex and could go either way:
Potential negative impact
If legislation or consumer pressure forces Deere to make their software and repair information more widely available, it could erode their aftersales service revenue, which is often a high-margin business. It could also potentially increase the risk of equipment damage or the copying of their technologies, though the extent of this risk is debatable.
Potential positive impact (indirect)
Conversely, a more open repair ecosystem could potentially lead to greater customer satisfaction and loyalty in the long run. Farmers who feel they have more control over their equipment’s maintenance might be more inclined to choose Deere in the first place.
Moreover, fostering a more collaborative environment with independent repair shops could potentially lead to innovative solutions and feedback that could benefit Deere in the long term.
Currently, the financial impact of the right to repair movement on Deere is difficult to quantify precisely. However, investors should closely monitor legislative developments and the evolving public sentiment around this issue, as it could represent both a potential risk to a significant revenue stream and an opportunity to build stronger customer relationships.
Investment outlook: Cultivating long-term growth
Despite the complexities of the right to repair debate, Deere’s strategic focus on agricultural automation and robotics positions them favorably for long-term growth. Their technological advancements address critical needs in the agricultural sector, promising increased efficiency and productivity.
While short-term market fluctuations and the cyclical nature of agriculture will always be factors to consider, Deere’s commitment to innovation suggests a company that is not just adapting to the future of farming but actively shaping it.
For investors with a long-term horizon, Deere represents an opportunity to invest in a company at the forefront of a fundamental transformation in a vital global industry.
However, as with any investment, thorough due diligence is crucial. Investors should monitor the company’s financial performance, their success in deploying and monetizing new technologies, and the evolving regulatory landscape, particularly concerning the right to repair.
Disclaimer: This analysis is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified financial advisor before making any investment decisions. The information presented is based on publicly available data and analysis, and there is no guarantee of future performance. Investment in the stock market involves risk, including the potential loss of principal.