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 $178.9B against $55.0B — 3.3× the size. PACCAR Inc. trades at the lower P/E: 19.9× against 36.9×. Deere & Company grew revenue faster over the last twelve months: 7.99% against −1.53%. Deere & Company has the higher net margin (10.2% vs 9.50%) and the lower return on invested capital (4.93% vs 9.47%). Both pay a dividend; PACCAR Inc. yields more (2.64% vs 0.97%). 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 36.87 19.89 21.67
P/S 3.74 1.89 0.77
P/B 6.41 2.63 1.31
Price to free cash flow 22.42 17.77 20.59
EV/EBITDA 19.94 12.48 11.30
EV/Sales 4.86 2.08 1.11
Earnings yield 2.71% 5.03% 3.08%
Free cash flow yield 4.46% 5.63% 3.12%

Profitability

Metric DE PCAR Farm & Heavy Construction Machinery median
Gross margin 36.59% 20.15% 22.91%
Operating margin 19.47% 13.80% 4.47%
Net margin 10.16% 9.50% 1.41%
Free cash flow margin 16.69% 10.65% 2.26%
Return on equity 18.33% 13.71% 3.99%
Return on assets 4.52% 6.18% 1.31%
Return on invested capital 4.93% 9.47% 4.09%

Growth

Metric DE PCAR Farm & Heavy Construction Machinery median
Revenue growth (TTM) 7.99% (1.53%) 1.81%
EPS growth (last fiscal year) (27.79%) (42.91%) (27.79%)
Revenue growth, 5-year CAGR 5.15% 8.72% 6.63%
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 0.71 0.66
Current ratio 2.10 3.22 1.98
Net debt to EBITDA 4.65 1.30 1.12

Dividend

Metric DE PCAR Farm & Heavy Construction Machinery median
Dividend yield 0.97% 2.64% 1.24%
Payout ratio 0.36 0.53 0.31

Size

Metric DE PCAR Farm & Heavy Construction Machinery median
Market cap 178.85b 55.02b 836.63m

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