The agriculture industry is thriving, driven by rising food consumption and increased demand for agricultural production. Higher food and commodity prices further boost the sector by enhancing incomes and incentivizing growth. In this dynamic environment, top agriculture stocks like Deere & Company (DE), ICL Group Ltd (ICL), and Dole plc (DOLE), are well-positioned for significant gains.
With a growing global population, food prices rose by 2.4% from November 2023 to November 2024. Rising commodity prices, such as of cocoa and coffee, signal potential gains for producers amid smaller harvests and strong global demand. The global agriculture market, projected to reach $19.29 trillion by 2028 with a CAGR of 7.7%, highlights the sector's promise.
Furthermore, this demand for food has accelerated the adoption of advanced farming technologies, agtech, and AI integration, especially in industrial farm machinery. These innovations are enhancing productivity and resilience, positioning the agriculture sector as a promising investment opportunity. Hence, global demand for agricultural equipment is projected to grow 3.6% annually, reaching $216 billion by 2028.
Given these positive trends, let's examine the fundamentals of the three agriculture stocks.
Deere & Company (DE)
DE engages in the manufacture and distribution of various equipment worldwide. The company operates through four segments: Production and Precision Agriculture, Small Agriculture and Turf, Construction and Forestry, and Financial Services.
On October 15, 2024, DE unveiled new Z900 EFI ZTrak Mowers and expanded QuikTrak Stand-On Mower deck options at the 2024 Equip Expo. These enhancements aim to improve performance, efficiency, and durability for professional landscape contractors.
On October 1, 2024, DE and DeLaval launched the Milk Sustainability Center, a digital platform that integrates agronomic and animal performance data to help dairy farmers improve efficiency and sustainability.
In terms of the trailing-12-month net income margin, DE’s 13.78% is 113.2% higher than the 6.46% industry average. Likewise, its 31.82% trailing-12-month Return on Common Equity is 136.6% higher than the 13.45% industry average. Furthermore, its 9.32% trailing-12-month Capex / Sales is 226.3% higher than the 2.86% industry average.
In the fiscal fourth quarter ended October 27, 2024, DE’s total revenue amounted to $11.14 billion. Similarly, the company’s attributable net income and EPS were $1.25 billion and $4.55, respectively. Moreover, as of October 27, 2024, DE’s total assets stood at $107.32 billion, compared to $104.09 billion as of October 29, 2023.
Analysts expect DE’s EPS and revenue for fiscal 2026 to increase 15.3% and 7.5% year-over-year to $22.74 and $42.01 billion, respectively. It surpassed the consensus EPS estimates in each of the trailing four quarters. DE’s stock has gained 13.4% over the past six months to close the last trading session at $432.49.
DE’s positive outlook is reflected in its POWR Ratings. The POWR ratings assess stocks by 118 different factors, each with its own weighting.
It has a B grade for Momentum. It is ranked #70 out of 79 stocks in the A-rated Industrial - Machinery industry. To access other ratings of DE for Growth, Value, Stability, Sentiment, and Quality, click here.
ICL Group Ltd (ICL)
Headquartered in Tel Aviv, Israel, ICL and its subsidiaries operate as a specialty minerals and chemicals company worldwide. It operates in four segments: Industrial Products, Potash, Phosphate Solutions, and Growing Solutions.
On December 13, 2024, ICL announced the launch of VeriQuel R100, an innovative phosphorus-based flame retardant for rigid polyurethane insulation, offering enhanced sustainability and fire safety. The product aligns with stricter environmental regulations and is compatible with existing manufacturing processes.
In terms of the trailing-12-month EBIT margin, ICL’s 11.01% is 2.4% higher than the 10.76% industry average. Its 5.83% trailing-12-month net income margin is 16.3% higher than the 5.01% industry average. Also, its 3.50% trailing-12-month Return on Total Assets is 44.3% higher than the 2.42% industry average.
During the third quarter ended September 30, 2024, ICL’s sales came in at $1.75 billion, and its adjusted operating income stood at $243 million, up 7% year-over-year. The company’s adjusted net income attributable to shareholders and adjusted earnings per share came in at $113 million and $0.11, respectively. Also, its adjusted EBITDA rose 10.7% year-over-year to $383 million.
Street expects ICL’s EPS for the quarter ending March 31, 2025, to increase 29.4% year-over-year to $0.12. Its revenue for fiscal 2025 is expected to grow 5.5% year-over-year to $7.32 billion. ICL surpassed the Street EPS estimates in each of the trailing four quarters. Over the past three months, the stock has gained 28.2% to close the last trading session at $4.87.
ICL’s POWR Ratings reflect strong prospects. It has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.
ICL is ranked first out of 24 stocks in the Agriculture industry. It has a B grade for Value, Stability, Sentiment, and Quality. In addition to the POWR Ratings grades I’ve just highlighted, you can see ICL’s ratings for Growth and Momentum, here.
Dole plc (DOLE)
Headquartered in Dublin, Ireland, DOLE engages in sourcing, processing, marketing, and distributing fresh fruit and vegetables worldwide. The company operates through three segments: Fresh Fruit; Diversified Fresh Produce - EMEA; and Diversified Fresh Produce - Americas and ROW. It offers bananas, pineapples, grapes, berries, avocados, organic produce, cherries, apples, potatoes, and onions.
In terms of the trailing-12-month Return on Common Equity, DOLE’s 11.35% is 7.6% higher than the 10.55% industry average. Similarly, its 1.85x trailing-12-month asset turnover ratio is 114.9% higher than the 0.86x industry average. Its 4.14% trailing-12-month Return on Total Assets is 7.7% higher than the 3.85% industry average.
DOLE’s net revenue increased 2.2% year-over-year, amounting to $6.31 billion for the nine months ended September 30, 2024. Similarly, its adjusted net income was $105.62 million, up 2.3% year-over-year, while its adjusted EPS rose marginally from the year-ago value of $1.11. Also, the company’s adjusted EBITDA increased 3% from the prior year’s period to $317.59 million.
For the quarter ending March 31, 2025, DOLE’s EPS is expected to increase 4.9% year-over-year to $0.45. Its revenue for the quarter ending June 30, 2025, is expected to rise marginally year-over-year to $2.14 billion. It surpassed the consensus EPS estimates in three of the trailing four quarters. The stock has gained 14.8% over the past nine months to close the last trading session at $13.70.
DOLE’s bright outlook is reflected in its POWR Ratings. It has an overall rating of B, translating to a Buy in our proprietary rating system.
It has a B grade for Value and Stability. It is ranked #2 in the Agriculture industry. To see DOLE’s Growth, Momentum, Sentiment, and Quality ratings, click here.
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DE shares were trading at $429.25 per share on Monday afternoon, down $3.24 (-0.75%). Year-to-date, DE has gained 8.55%, versus a 25.81% rise in the benchmark S&P 500 index during the same period.
About the Author: Abhishek Bhuyan
Abhishek embarked on his professional journey as a financial journalist due to his keen interest in discerning the fundamental factors that influence the future performance of financial instruments.
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