AGCO · AGCO
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $133.40
Note written ·
Price against the kill line
16.1% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $133.40, on record since 11 November 2026. The shares are up 12.2% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $133.40, near the early-September highs, which would show the shares leading the S&P 500. A raised 2026 sales outlook from AGCO, or Deere guiding fiscal 2027 large-agriculture demand up, would point the same way.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Industrials
Quarter to 30 September 2026, filed 29 October 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 2,263
- Revenue, change on a year (%)
- −8.6
- Gross margin (%)
- 25.0
- Operating margin (%)
- 5.1
- Free cash flow, four quarters ($M)
- 294
- Net cash, cash less debt ($M)
- −2,262
- Price to earnings (×)
- 27.6
- Enterprise value to sales (×)
- 1.0
All filed numbers
What AGCO reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 2,263 | −8.6 | 25.0 | 5.1 |
| first filed | 2,610 | −1.0 | 24.7 | 5.4 |
| first filed | 2,343 | +14.3 | 24.8 | 3.4 |
| first filed | 2,920 | +1.1 | 25.4 | 7.9 |
| first filed | 2,476 | −4.7 | 26.1 | 6.1 |
| first filed | 2,635 | −18.8 | 25.0 | 6.2 |
| Pre-tax income ($M) | 68.1 |
| Net income ($M) four quarters: 279 | 51.7 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −7.0 |
| Operating cash flow ($M) | 545 |
| Capital spending ($M) | 251 |
| Free cash flow ($M) | 294 |
| Cash and short-term investments ($M) | 415 |
| Debt ($M) non-current long-term debt plus current debt | 2,677 |
| Net cash, cash less debt ($M) | −2,262 |
| Deferred revenue ($M) −0.6% on a year | 377 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 1,231 |
| Inventory ($M) | 3,005 |
| Shareholders' equity ($M) | 4,065 |
| Market value ($M) | 7,718 |
| Enterprise value, market value plus net debt ($M) | 9,980 |
| Enterprise value to sales (×) | 1.0 |
| Enterprise value to operating income (×) | 17.6 |
| Price to earnings (×) | 27.6 |
| Price to book value (×) | 1.9 |
| Free-cash-flow yield (%) | 3.8 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 5.4% of shares outstanding sold short, 3.8 days of average trading to cover, +4.0% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $3.7M |
| 12 monthsfrom | $101K | $113.1M |
The thesis
AGCO Corporation's farm-equipment recovery case now rests on 2027, and the shares are more likely to lag the S&P 500 than lead it. The 29 October 2026 third-quarter report beat on earnings, missed on sales and cut full-year sales guidance. Deere's report, expected on 25 November 2026, is the next test of North American large-agriculture demand.
The shares closed at $114.79 on 11 November 2026, up 15.8% over three months and 20.2% below the 52-week high of $143.78 set on 12 February 2026. The market has priced in a 2027 recovery: the shares rose after the report despite the guidance cut. Adjusted earnings per share (EPS) of $1.05 beat the $0.85–0.90 July guidance, but sales of $2.26 billion fell below the $2.3 billion low end.
Bullish and bearish views on AGCO Corporation
The bull case on AGCO Corporation (AGCO), in brief: earnings beat the guided range. The bear case: sales missed and guidance was cut.
Bull case
- Earnings beat the guided range. Third-quarter adjusted EPS was $1.05 against July guidance of $0.85–0.90 and $1.35 a year earlier (AGCO 8-K, 29 October 2026). Margin held while sales fell 8.6%.
- North America is growing. Third-quarter North American sales rose 35.1% excluding currency, and Asia/Pacific/Africa rose 9.2% (8-K, 29 October 2026). North American operating income was $13.8 million against a $42.0 million loss a year earlier, though the 10-Q says it includes about $13.0 million of tariff refunds.
- The share count is shrinking. AGCO spent $403.7 million on repurchases in the first nine months of 2026, and weighted average basic shares were 69.4 million against 74.6 million a year earlier (8-K, 29 October 2026). Fewer shares lift EPS even when sales are flat.
- Two analyst targets sit well above the price. JPMorgan maintained Overweight and raised its target to $145 on 30 October 2026. Truist reiterated Buy with a $136 target on 2 November 2026.
Bear case
- Sales missed and guidance was cut. Third-quarter sales of $2.263 billion missed the $2.325 billion analyst estimate, and 2026 sales guidance fell to $9.8–10.0 billion from $10.1–10.2 billion (8-K and company news, 29 October 2026). Adjusted EPS guidance of about $5.50 was narrowed from $5.50–5.75.
- Europe and Latin America deteriorated. Excluding currency, third-quarter sales fell 18.1% in Europe/Middle East and 19.1% in Latin America (8-K, 29 October 2026). Europe/Middle East sales were $1.306 billion against $1.613 billion a year earlier, per AgNavigator.
- Industry demand remains low. North American tractor sales fell 9% and combine sales fell 10% in the first nine months of 2026, and Brazilian combine sales fell 38%, per AgNavigator on 29 October 2026. Chief executive Eric Hansotia cited lower farm income and uncertain global agricultural markets.
- An executive sold shares after the report. Torsten Dehner, senior vice president and general manager of Fendt/Valtra, sold 27,393 shares at an average $111.37 between 6 November 2026 and 9 November 2026 (SEC Form 4, filed 10 November 2026). A single sale by one officer is a small sample.
- Analysts disagree sharply. Morgan Stanley maintained Underweight and raised its target to $113 on 4 November 2026. Barclays held Underweight with a $97 target on 19 October 2026. Truist lowered its target to $136 from $146 on 2 November 2026.
- A regulatory inquiry is open. The Federal Trade Commission (FTC) and US Department of Agriculture (USDA) asked on 7 October 2026 for public comment on agricultural equipment practices. Comments close 7 December 2026.
Price setup
AGCO closed at $114.79 on 11 November 2026, between the 50-day average of $113.96 and the 200-day average of $115.94 (adjusted closes). Recent closes were $110.22 on 5 November 2026, $110.44 on 6 November 2026, $116.52 on 9 November 2026 and $113.15 on 10 November 2026. The shares have moved around both averages for a week without a clear break.
The three-month gain of 15.8% runs from an adjusted close of $99.15 on 13 August 2026. The 52-week closing low was $98.45 on 18 August 2026. The 52-week high of $143.78 on 12 February 2026 sits 20.2% above the last close.
Analyst targets now run from $97 at Barclays to $145 at JPMorgan. Morgan Stanley's $113 target sits just below the close, and Truist's $136 target sits above it.
Catalysts ahead
- ~25 November 2026 (est.): Deere fiscal fourth-quarter 2026 earnings and fiscal 2027 outlook (before market open, expected). Deere's view of North American large-agriculture demand tests whether AGCO's 2027 recovery framing holds, since AGCO's North American sales rose 35.1% in the third quarter.
- 7 December 2026: Close of the FTC/USDA public comment period on agricultural equipment practices. Sets the timeline for any action on repair, parts and dealer practices across the sector.
What would change the view
A daily close above $133.40, near the early-September highs, which would show the shares leading the S&P 500. A raised 2026 sales outlook from AGCO, or Deere guiding fiscal 2027 large-agriculture demand up, would point the same way.
What it trades with
AGCO trades with Deere and CNH, other farm-equipment makers, because all three depend on farm income, commodity prices and the North American replacement cycle. Deere's report, expected on 25 November 2026, is the nearest shared event. AGCO's weighting to Europe and Brazil, where third-quarter sales fell 18.1% and 19.1%, separates it from Deere's more North American mix. Currency and tariffs add company-specific swings. Mexico's move into the Latin America segment on 1 January 2026 changes how regional comparisons read.
The evidence, claim by claim (8)
- AGCO third-quarter 2026 net sales were $2.26 billion, down 8.6% year over year; adjusted EPS was $1.05 against $1.35 a year earlier; reported EPS was $0.75. AGCO Form 8-K earnings release, 29 October 2026 · as of
- Third-quarter sales excluding currency: North America +35.1%, Europe/Middle East −18.1%, Latin America −19.1%, Asia/Pacific/Africa +9.2%. AGCO Form 8-K earnings release, 29 October 2026 · as of
- AGCO lowered 2026 net sales guidance to $9.8–10.0 billion from $10.1–10.2 billion and set adjusted EPS at about $5.50, narrowed from $5.50–5.75; adjusted operating margin is guided to about 7.0%. AGCO Form 8-K earnings release, 29 October 2026 · as of
- AGCO spent $403.7 million on share repurchases in the first nine months of 2026; weighted average basic shares were 69.4 million in the third quarter against 74.6 million a year earlier. AGCO Form 8-K earnings release, 29 October 2026 · as of
- North American tractor sales fell 9% and combine sales 10% in the first nine months of 2026; Brazilian tractor sales fell 17% and combine sales 38%. AgNavigator report on AGCO Q3 2026 results, 29 October 2026 · as of
- Morgan Stanley maintained Underweight and raised its target to $113; Truist reiterated Buy and lowered its target to $136; JPMorgan maintained Overweight and raised its target to $145. Analyst rating reports, 30 October to 4 November 2026 · as of
- Torsten Dehner, SVP GM Fendt/Valtra, sold 27,393 shares at an average $111.37 between 6 November 2026 and 9 November 2026. SEC Form 4 filed 10 November 2026 · as of
- AGCO closed at $114.79 on 11 November 2026, between its 50-day average of $113.96 and 200-day average of $115.94; the three-month change was a 15.8% gain. Split/dividend-adjusted daily closes · as of
Sources
- AGCO CORP /DE - Form 8-K - FY2026 · sec.gov ·
- AGCO posts 8.6% drop in net sales in Q3 2026 earnings as ag machinery market recovery stalls · agnavigator.com ·
- AGCO CORP /DE - Form 10-Q - FY2026 · sec.gov
- DEERE & (DE) Earnings Date · unusualwhales.com
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