Value
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.2 |
| P/S | 9.9 |
| EV/EBITDA | 6.1 |
| Fwd P/E | 8.5 |
| PEG | 6.6 |
| Analyst target | 6.0 |
- ▸Forward P/E: 13.6x
- ▸PEG: 1.10
- ▸Attractively valued
AGCO · Why this verdict
Why AGCO (AGCO) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
AGCO has delivered four consecutive earnings beats with an average surprise of 41% and trades at an attractively valued forward P/E of 13.9x, but below-average business quality, a stock sitting near its near-term resistance target, and a put/call ratio of 2.07 signal that institutional sentiment is more cautious than the earnings track record alone would imply.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality is below average — gross and operating margins are thin, and the overall quality profile sits below the level that supports a high-conviction position — limiting the multiple the stock can sustain even with strong earnings delivery. Key risks | Quality concerns diminish if quarterly EPS exceeds $1.50 for 2 consecutive quarters, demonstrating that the earnings beat momentum is translating into durable profitability above recent troughs. | ↓Deteriorating |
| CounterA Piotroski F-Score of 7 out of 9 reflects solid financial health, and the four-quarter beat streak demonstrates the business is currently operating above expectations — reported margins may understate the earnings power being revealed each period. | ||
All four of the most recent quarterly results beat consensus estimates, with a 113% upside surprise in the most recent quarter and an average beat of 41% over the full four-quarter stretch — a pattern that indicates the company has been consistently under-promising and over-delivering. Catalyst track record | The beat streak should continue for at least 2 more quarters with positive EPS surprise, sustaining the track record of consistent outperformance. | ↓Deteriorating |
| CounterAn average surprise of 41% — heavily inflated by the most recent quarter's 113% beat — may reflect temporarily depressed consensus estimates or a one-time benefit rather than sustainable outperformance; future beats could be considerably smaller even if the direction holds positive. | ||
At a forward P/E of 13.9x with a PEG of 1.12, the stock screens attractively valued against its peers and offers a reasonable entry multiple relative to the earnings growth being delivered. Valuation breakdown | Valuation remains attractive if the forward P/E stays below 17x while EPS estimates continue to rise or hold firm over the next four quarters. | →Stable |
| CounterThe stock has already reached the vicinity of its near-term resistance target with only 5.8% upside remaining, implying the cheap-multiple argument is largely reflected in current pricing. | ||
The stock sits 5.8% below its near-term resistance target with a reward-to-risk ratio of only 0.84-to-1 — the setup does not yet offer the asymmetry needed to justify adding a new position, even alongside the strong earnings track record. Price targets | Setup improves if the reward-to-risk ratio rises above 1.5x from the current 0.84x, which would require either a meaningful price pullback or an upward revision to the price target. | →Stable |
| CounterVolume is accumulating on a rising OBV trend and the long-term moving average is still rising — the pullback below the 200-day moving average may prove temporary, making the mechanical risk-reward constraint less binding than it appears. | ||
A put/call ratio of 2.07 — more than twice the balanced level — indicates that options market participants are positioning defensively, buying significantly more downside protection than upside participation, which reflects institutional caution about near-term price direction. Risk breakdown | Put/call ratio should compress below 1.2 over the next 3 months to signal that hedging demand is normalizing and institutional sentiment is improving. | ↓Deteriorating |
| CounterElevated put/call ratios can reflect hedging by long holders protecting existing gains rather than outright bearish speculation — the defensive options positioning may coexist with continued ownership and be consistent with longer-term constructive views. | ||
Business quality is below average — gross and operating margins are thin, and the overall quality profile sits below the level that supports a high-conviction position — limiting the multiple the stock can sustain even with strong earnings delivery.
↓DeterioratingKey risks
- Expectation
- Quality concerns diminish if quarterly EPS exceeds $1.50 for 2 consecutive quarters, demonstrating that the earnings beat momentum is translating into durable profitability above recent troughs.
CounterA Piotroski F-Score of 7 out of 9 reflects solid financial health, and the four-quarter beat streak demonstrates the business is currently operating above expectations — reported margins may understate the earnings power being revealed each period.
All four of the most recent quarterly results beat consensus estimates, with a 113% upside surprise in the most recent quarter and an average beat of 41% over the full four-quarter stretch — a pattern that indicates the company has been consistently under-promising and over-delivering.
↓DeterioratingCatalyst track record
- Expectation
- The beat streak should continue for at least 2 more quarters with positive EPS surprise, sustaining the track record of consistent outperformance.
CounterAn average surprise of 41% — heavily inflated by the most recent quarter's 113% beat — may reflect temporarily depressed consensus estimates or a one-time benefit rather than sustainable outperformance; future beats could be considerably smaller even if the direction holds positive.
At a forward P/E of 13.9x with a PEG of 1.12, the stock screens attractively valued against its peers and offers a reasonable entry multiple relative to the earnings growth being delivered.
→StableValuation breakdown
- Expectation
- Valuation remains attractive if the forward P/E stays below 17x while EPS estimates continue to rise or hold firm over the next four quarters.
CounterThe stock has already reached the vicinity of its near-term resistance target with only 5.8% upside remaining, implying the cheap-multiple argument is largely reflected in current pricing.
The stock sits 5.8% below its near-term resistance target with a reward-to-risk ratio of only 0.84-to-1 — the setup does not yet offer the asymmetry needed to justify adding a new position, even alongside the strong earnings track record.
→StablePrice targets
- Expectation
- Setup improves if the reward-to-risk ratio rises above 1.5x from the current 0.84x, which would require either a meaningful price pullback or an upward revision to the price target.
CounterVolume is accumulating on a rising OBV trend and the long-term moving average is still rising — the pullback below the 200-day moving average may prove temporary, making the mechanical risk-reward constraint less binding than it appears.
A put/call ratio of 2.07 — more than twice the balanced level — indicates that options market participants are positioning defensively, buying significantly more downside protection than upside participation, which reflects institutional caution about near-term price direction.
↓DeterioratingRisk breakdown
- Expectation
- Put/call ratio should compress below 1.2 over the next 3 months to signal that hedging demand is normalizing and institutional sentiment is improving.
CounterElevated put/call ratios can reflect hedging by long holders protecting existing gains rather than outright bearish speculation — the defensive options positioning may coexist with continued ownership and be consistent with longer-term constructive views.
Per-dimension breakdown
Quality
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.9 |
| ROA | 2.3 |
| Gross margin | 1.1 |
| Op margin | 2.3 |
| Net margin | 2.6 |
| Current ratio | 5.0 |
| FCF quality | 6.2 |
| Moat | 3.9 |
| Piotroski F | 4.4 |
- ▸No competitive moat
Growth
1.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.2 |
| EPS growth | 0.0 |
- ▸Declining revenue: -1%
Momentum
2.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 2.1 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+0.8%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 3.3 |
| Analyst rating | 5.0 |
| Price target | 7.7 |
- ▸LLM news sentiment: -0.33 (n=3)
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.1 |
| quality rank | 5.6 |
| growth rank | 2.2 |
- ▸Attractive P/E vs peers
Technical
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.4 |
| support resistance | 9.3 |
| 52w position | 4.4 |
Risk (lower is worse)
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.6 |
| days to cover | 6.8 |
| volatility | 0.1 |
| put call | 0.0 |
| implied vol | 3.4 |
| beta | 6.7 |
| debt equity | 7.0 |
- ▸Elevated put/call: 3.33
Catalyst
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 8.5 |
| news activity | 7.0 |
- ▸Strong earnings: 3B/1M
- ▸Dividend aristocrat: 1.2% yield
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (4)
- INSIDER:OK
- EARNINGS_PROXIMITY:80d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.0<4.5
- ASYMMETRY:0.8<1.5@spot
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
0.78
Upside
+7.8%
Downside
9.9%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 2.0<4.5 outcome against Value at 7.4 and asymmetric R:R of 0.78.
The strongest dimensions are Value at 7.4, Technical at 7.4, and Insider at 7.3; the weakest are Growth at 1.1, Momentum at 2.0, and Quality at 3.5. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of 0.78 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Earnings Beat Streak
Trip ifEPS surprise falls below 0% for 2 consecutive quarters, breaking the 4-quarter beat streak.
- P2Attractive Valuation For Sector
Trip ifForward P/E expands above 17x without a corresponding earnings estimate upgrade, signaling the valuation premium has fully compressed.
- P3Below Average Business Quality
Trip ifQuarterly EPS exceeds $1.50 for 2 consecutive quarters, demonstrating durable earnings power above the recent trough.
- P4Unfavorable Price Geometry
Trip ifReward-to-risk ratio rises above 1.5x from current 0.84x, restoring favorable entry geometry.
- P5Elevated Options Skew Caution
Trip ifPut/call ratio compresses below 1.2 from current 2.07, signaling normalization of defensive positioning.