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John Deere Raises Its Quarterly Dividend Rate

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Deere increases dividend

On May 30, Deere (DE) declared a dividend of $0.69 per share for shareholders as of June 29, which represents a 15% increase over its previous dividend of $0.60 per share. The last time DE increased its dividend was in Q3 2014. The dividend is expected to be paid on August 1.

Factoring in this dividend increase, DE’s annual dividend for this year would be $2.38 per share. DE’s dividend yield based on its June 1 closing price was 1.7%.

DE chairman and CEO Samuel R. Allen said, “Today’s announcement reaffirms our confidence in the company’s present direction and our belief that Deere will continue to deliver significant long-term value to investors and customers,” adding,”We remain committed that the more durable business model now in place at Deere will result in strong financial performance throughout the business cycle.”

Update on Deere’s stock price

Surprisingly, DE stock fell 3.5% and closed at $153.39 last week. As a result, the stock was 1.3% below its 100-day moving average of $155.51, indicating a trend reversal. Year-to-date, the stock has fallen 2.9%. However, analysts are bullish on Deere stock and have recommended a target price of $181.60, implying an 18.4% upside based on its June 1 closing price.

Peers Caterpillar (CAT), AGCO (AGCO), and CNH Industrial (CNHI) have fallen 2.6%, 9.9%, and 12.3%, respectively. DE’s 14-day RSI (relative strength index) score of 55 indicates that the stock is neither overbought nor oversold. Investors can indirectly hold Deere through the iShares MSCI Global Agriculture Producers ETF (VEGI), which had 10.9% of its portfolio invested in Deere as of June 1.

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