* Q2 EPS $2.08 vs. Street forecast $1.80
* Revenue up 14 percent to $2.69 billion
* Raises forecast to range above Street
* Shares rose 4.1 percent to $42.67
July 26 Farm equipment maker AGCO Corp
on Thursday posted a stronger-than-expected quarter profit and
raised its forecast, and executives said they are worried about
the U.S. drought but confident their global portfolio will
Shares of the Duluth, Georgia-based company rose 4.1 percent
to $42.67 in Thursday afternoon trading.
For the second quarter, the company posted net income of
$204.9 million, or $2.08 per share, compared with $133.7
million, or $1.36 per share, in the year-ago quarter.
Analysts expected earnings of $1.80 per share, according to
Thomson Reuters I/B/E/S.
Sales rose 14 percent to $2.69 billion. Analysts expected
The worst U.S. drought in more than 50 years is harming the
corn crop and prompting concern about final yield numbers at
harvest time this fall. If yields fall, that could crimp demand
for the tractors and combines made by AGCO.
JPMorgan downgraded AGCO rival Deere & Co earlier
this month, worried sales of tractors and combines could slide
heading into 2013 as farmers conserve cash amid the U.S.
Martin Richenhagen, AGCO's chief executive, said he expects
U.S. corn yields to dip 20 percent this year due to the drought,
but notes his company's large global reach - with most sales
outside the United States - means results likely won't be
"America is just a fraction of the current market," he said
in an interview. "The world doesn't stand still just because of
weather conditions which we are used to in farming."
The company raised its earnings outlook for 2012 to a range
of $5.50 to $5.75 per share. It had previously forecast $5.50
per share. Analysts expect $5.49 per share for the year.
"A drought doesn't mean farmers don't invest in their
business," Richenhagen said. "It's the only business they have."