The entire agriculture complex has been moving of late with food commodity prices soaring for a number of reasons from shortages in some countries to world growth rebounding.
DE has naturally been a beneficiary of this as farmers need equipment to take advantage of the situation and get as much out of it as they can, as soon as they can. As noted above, farmers have quite a bit of free cash sitting around that many analysts have noted is being put to use in new purchases.
DE’s bottom line shows this as its recent earnings and sales have soared.
DE is not some new hot shot company that could grow several hundred times over in a short period of time. With the conditions currently right for it, however, DE is seeing and is likely to continue to see excellent near-term growth.
DE is currently about 3.7% above its most recent buy point. On the weekly chart below, you can see where it pushed higher from three tight weekly closes in a row. The daily chart shows volume coming in on that day’s push higher above the 3 week’s tight buy point, showing conviction in the move.
Keep in mind, DE reports earnings Wednesday. While it has beat earnings expectations 7 quarters in a row, it is worth noting that Jim Cramer, host of CNBC’s Mad Money, pointed out the stock itself has not done well after earnings reports, selling off more than it has rallied.
Technically speaking, DE’s chart shows a steady move higher. When it has pulled back, it hasn’t been much. Also, when it’s pushed higher, the moves haven’t been huge either. This is a classic steady-eddie that just grinds higher.
I did buy some recently and made money on it and got out. I also bought some more last week, but may take my so far small profits and wait, as Cramer suggests, until after the report to consider getting back it, if I do at all. I like to concentrate my money on the stocks that show a potential for going higher, faster.
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