Deere, Foot Locker jump after earnings results

Yahoo Finance's Emily McCormick joins Akiko Fujita to break down the latest quarterly earnings results from Deere and Foot Locker.

Video Transcript

AKIKO FUJITA: Two big stocks moving today on the back of some strong earnings-- let's start with Deere. That stock is hitting a new high today in the session after beating on the top and bottom lines. Emily McCormick here to break down that number for us. Emily, what stood out to you in the quarter?

EMILY MCCORMICK: Well, Akiko, taking a look at Deere's fiscal third quarter results, these are really turbo-charged by a better-than-feared pickup in farm equipment demand. So overall, we saw third quarter net sales of $7.86 billion, down 12% year-over-year, but still better than the about $6.7 billion that had been expected. We also saw adjusted earnings per share of $2.57, also better than expected.

Now taking a look by business segment, we saw agriculture and turf net sales at $5.7 billion, construction and forestry net sales at $2.2 billion, and each of these topped estimates as well. Now, Deere, did something that we haven't seen many companies do during these past quarterly results, and that's actually deliver guidance and raise its guidance for the full fiscal year. The company now sees full-year net income of $2.25 billion. Previously, it saw net income in a range of $1.6 billion to $2 billion.

Now the company also pared back the degree of decline it expects to see across its business during the full fiscal year. It now sees full-year agriculture and turf equipment sales down 10%. That's better than the as much as 15% decline it saw previously. It also sees construction and forestry equipment sales down 25%, or from a much better result than the down 40% it had expected before.

So we are seeing Deere shares rising and on pace for a record close today. They did hit a record intraday high. Akiko?

AKIKO FUJITA: Emily, another stock that's getting a pop in the session-- Foot Locker. This was a company that had a big loss in the first quarter. What did they do right in this quarter?

EMILY MCCORMICK: Well, Akiko, as we've seen with a number of retailers here. Foot Locker also getting a huge boost from its direct-to-consumer and particularly its digital sales. We saw its second quarter comparable same-store sales overall up 18.6%. That was a huge year-over-year acceleration from the 0.8% increase we saw in the same quarter last year.

Now, again, Foot Locker calling out digital sales as being key to growth. We saw direct-to-consumer sales up 173%. That more than offset a 7.6% drop in physical store sales that occurred as many of its in-person locations were closed due to the pandemic.

The company also broke out its sales trajectory by month. It noted that May comparable same store-sales were down by high single digits, whereas June and July were much stronger, each producing high double-digit gains. So we are seeing this company on an upward trend.

It called out apparel sales and footwear sales in particular as being the strong points here during the business. It said consumers are also looking for comfort as they continue to work from home. So a couple trends to continue watching here with Foot Locker, Akiko.

AKIKO FUJITA: OK, thanks so much for that, Emily.