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Deere & Company (DE) vs PACCAR Inc. (PCAR)

Deere & Company and PACCAR Inc. are both Farm & Heavy Construction Machinery companies. Deere & Company is the larger, with a market value of $175.4B against $58.3B — 3.0× the size. PACCAR Inc. trades at the lower P/E: 23.3× against 35.6×. Deere & Company grew revenue faster over the last twelve months: 7.99% against −10.6%. Deere & Company has the higher net margin (10.2% vs 9.00%) and the lower return on invested capital (4.93% vs 8.85%). Both pay a dividend; PACCAR Inc. yields more (2.49% vs 1.01%). Across the 23 metrics below, PACCAR Inc. leads on 15 and Deere & Company on 8.

Valuation

Metric DE PCAR Farm & Heavy Construction Machinery median
P/E 35.56 23.28 23.28
P/S 3.61 2.10 0.75
P/B 6.19 2.87 1.43
Price to free cash flow 21.62 15.86 22.25
EV/EBITDA 19.40 14.16 11.41
EV/Sales 4.73 2.31 1.14
Earnings yield 2.81% 4.30% 2.83%
Free cash flow yield 4.62% 6.31% 2.91%

Profitability

Metric DE PCAR Farm & Heavy Construction Machinery median
Gross margin 36.59% 19.99% 24.21%
Operating margin 19.47% 13.33% 4.47%
Net margin 10.16% 9.00% 1.49%
Free cash flow margin 16.69% 13.24% 2.15%
Return on equity 18.33% 12.76% 3.99%
Return on assets 4.52% 5.69% 1.31%
Return on invested capital 4.93% 8.85% 3.36%

Growth

Metric DE PCAR Farm & Heavy Construction Machinery median
Revenue growth (TTM) 7.99% (10.56%) 2.18%
EPS growth (last fiscal year) (27.79%) (42.91%) (27.79%)
Revenue growth, 5-year CAGR 5.15% 8.72% 7.34%
Net income growth, 5-year CAGR 12.81% 12.80% 0.00%

Health

Metric DE PCAR Farm & Heavy Construction Machinery median
Debt to equity 2.28 0.72 0.67
Current ratio 2.10 3.12 1.98
Net debt to EBITDA 4.65 1.30 1.12

Dividend

Metric DE PCAR Farm & Heavy Construction Machinery median
Dividend yield 1.01% 2.49% 1.34%
Payout ratio 0.36 0.58 0.30

Size

Metric DE PCAR Farm & Heavy Construction Machinery median
Market cap 175.44b 58.33b 808.87m

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