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LONDON, UK / ACCESSWIRE / May 11, 2017 / Active Wall St. announces its post-earnings coverage on AGCO Corp. (NYSE: AGCO). The Company posted its first quarter fiscal 2017 results on April 28, 2017. The farm equipment maker reported better than expected revenue and earnings results. Register with us now for your free membership at:

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One of AGCO Corp.'s competitors within the Farm & Construction Machinery space, Terex Corp. (NYSE: TEX), releases its Q1 2017 financial results on Wednesday, May 03, 2017. AWS will be initiating a research report on Terex in the coming days.

Today, AWS is promoting its earnings coverage on AGCO; touching on TEX. Get our free coverage by signing up to:

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Earnings Reviewed

For the quarter ended March 31, 2017, AGCO reported net sales of approximately $1.63 billion, up 4.4% compared to net sales of $1.56 billion in Q1 2016. Excluding unfavorable currency translation impacts of approximately 0.9%, net sales in the reported quarter increased approximately 5.2% on a y-o-y basis. The Company's revenue numbers topped analysts' consensus of $1.54 billion.

For Q1 2017, AGCO reported net loss of $10.1 million, or $0.13 per share, compared to net income of $7.8 million, or $0.09 per share, in Q1 2016. Excluding restructuring expenses and a non-cash expense related to waived stock compensation, the Company reported adjusted net loss of $0.02 per share. AGCO's results were better than Wall Street's estimates which expected the Company to post loss of $0.13 per share.

Segment Results

During Q1 2017, AGCO's North America net sales decreased 5.7% to $382.6 million, excluding the negative impact of currency translation. The drop was attributed to Dealer inventory reduction efforts and softer industry demand. Sales declines were most significant in hay tools, grain storage equipment and sprayers and were partially offset by increased sales of tractors. The segment's income from operations for the reported quarter improved approximately $3.2 million on a y-o-y basis.

For AGCO's South America segment's net sales surged 31.1% to $222.2 million, excluding the impact of favorable currency translation, the growth was driven by significant sales increases in Brazil and Argentina. The division's income from operations improved approximately $1.8 million on a y-o-y basis, as the benefit of higher sales and production volumes, and positive impact of currency translation was mostly offset by material inflation and the costs associated with transitioning to the new tier 3 emission standards.

AGCO's Europe/Middle East net sales increased 4.0% to $892.5 million, excluding unfavorable currency translation impacts, primarily due to the benefit of acquisitions. Higher sales in Germany and the United Kingdom were partially offset by sales declines in France. The segment's income from operations decreased approximately $2.8 million for the reported quarter, due to higher engineering expenses and the negative impact of currency translation, partially offset by the benefit of higher sales.

Net sales in AGCO's Asia/Pacific/Africa region, excluding the negative impact of currency translation, increased 22.1% in Q1 2017 to $130.3 million primarily due to increased sales in Australia and China. Income from operations improved approximately $2.8 million in the reported quarter due to higher sales levels.

Outlook

AGCO is expecting weak global demand for farm equipment is expected to continue to negatively impact the Company's sales and earnings in 2017. AGCO's net sales for 2017 are expected to reach $7.7 billion. Gross and operating margins are expected to be improved from 2016 levels due to higher sales along with the benefits from the Company's cost reduction initiatives. AGCO is targeting FY17 EPS at approximately $2.70 excluding restructuring expenses and the non-cash expense related to waive stock compensation.

Stock Performance

At the closing bell, on Wednesday, May 10, 2017, AGCO's share price finished yesterday's trading session at $64.37, marginally up 0.86%. A total volume of 718.22 thousand shares exchanged hands, which was higher than the 3 months average volume of 639.59 thousand shares. The stock has surged 27.56% and 24.21% in the last six months and past twelve months, respectively. Furthermore, since the start of the year, shares of the Company have rallied 11.49%. The stock is trading at a PE ratio of 36.82 and has a dividend yield of 0.87%.

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SOURCE: Active Wall Street