Were John Deere Insiders Privy To Privileged Information?
In the months leading up to Deere & Company's (NYSE:DE) announcement that it had cut its full-year profit forecast, company executives performed millions of dollars' worth of insider trades, which came shortly before the company's stock fell sharply.
According to Bloomberg, Deere slashed its full-year profit to $3.1 billion for the year ending October 31, compared with its May forecast of $3.35 billion. The lower estimate comes after the company experienced waning demand in Argentina and India, both of which the company once believed would soon boom and lead to much higher sales.
CEO Sam Allen said he hopes to bring in revenue of $50 billion from developing nations by 2018, a time when Deere said it expects to receive half of all its sales from overseas buyers. This plan, however, doesn't seem to be holding up.
"The fundamentals are deteriorating," Stephen Volkmann, a New York-based analyst for Jefferies.
The drop in shares comes after company officials sold $3.19 million through insider trades in the last three months.
Do you think these sales were made on insider information?
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