Deere & Company manufactures and distributes farm and construction machinery that it sells around the world. In addition to its manufacturing operations, Deere’s credit division loans money to customers to finance the purchase of their farm and construction equipment. The following information is available for three recent years (in millions except per share amounts):

1. Calculate the following ratios for each year, rounding ratios and percentages to one decimal place, except for per-share amounts:

a. Return on total assets

b. Return on stockholders’ equity

c. Earnings per share

d. Dividend yield

e. Price-earnings ratio

2. Based on these data, evaluate Deere’s profitability.

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Year 3 Year 2 $2,159.1 $1,523.9 Year 1 Net income $2,368.4 Preferred dividends 50.00 $0.00 50.00 Interest expense $1,203.6 s899.5 $763.7 Shares outstanding for computing earnings per share Cash dividend per share Average total assets Average stockholders'equity Average stock price per share 323 320 315 $2.58 $2.40 $2.40 $67,947 $61,852 $57,933 $10,426 $8,046 $6,644 $134.16 $110.59 583.94