Titan machines (TITN) fell Thursday morning after the agricultural and construction equipment chain reported preliminary second-quarter results that fell well short of expectations. The company cited a sharp drop in agricultural commodity prices and high interest rates for farmers. Heavy equipment names in the S&P 500, however, appeared to shrug off the news.
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The North Dakota-based operation said Wednesday night that second-quarter earnings per share fell 88% to about 17 cents, while revenue came in at about $634 million, down more than 1% from a year ago. Titan management said the declines reflected lower-than-expected equipment revenues amid gradually weaker retail demand.
The company also lowered its 2025 earnings guidance to $0-$0.50 from its previous forecast of $2.25-$2.75 per share. The adjustment included a negative 36 cent impact from non-cash sale-leaseback financing costs, Titan Machinery said.
Before Wednesday’s announcement, analysts had expected second-quarter earnings of 48 cents per share on revenue totaling $683 million, according to FactSet. Consensus had expected earnings of $1.80 per share in TITN’s 2025 earnings.
Titan Machinery shares fell 13.8% to 13.16 in market action on Thursday. TITN shares were down slightly on Wednesday, falling 0.7% to 15.37. At 8:30 a.m. ET, investors received July retail sales figures, weekly jobless claims and August readings for the Philly Fed manufacturing index and the New York Fed’s Empire State manufacturing index.
S&P 500: Commodity prices hit TITN
“Lower commodity prices and persistently high interest rates, combined with mixed growing conditions in our region, have negatively impacted farmer sentiment,” CEO Bryan Knutson said in the earnings update.
Knutson added that prices for “key cash crops” have fallen sharply in 2024, falling another 10%-20% in the second quarter.
As of Thursday, wheat prices had fallen 13% in 2024. Corn futures prices have fallen more than 20% this year.
Knutson added that the company’s current focus is on reducing inventory levels and expanding its parts and service operations.
Ahead of Thursday’s trading, Titan Machinery stock has already fallen about 14% in August. Shares are down 47% through 2024.
Other names for heavy equipment include S&P 500 components Deer (THE), Cumin (CMI number), Caterpillar (CAT) and United Rental (URI number).
Deere reported better-than-expected earnings and revenue for its fiscal third quarter on Thursday morning, even as profit fell about 39% from a year ago. The company noted that global agricultural fundamentals were expected to remain weak as construction activity slowed. Deere also maintained its full-year revenue forecast of $7 billion.
“In response to weak market conditions, we have taken steps to reduce costs and strategically align our production with customer needs,” Deere Chief Executive John May said in the earnings release Thursday. “While these decisions were difficult, they are vital to our continued success and competitiveness.”
Deere shares rose 5.3% to 369.83 early in the morning, while Cummins shares rose 2.6%. S&P 500 giant CAT shares rose 2.6% and URI shares rose 3.4%.
Titan Machinery shares have a Composite Rating of 29 out of a possible 99. The shares also have a Relative Strength Rating of 8 and an EPS Rating of 85.
Follow Kit Norton on X @KitNorton for more information.
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