CNH

ACCE thesis

CNH designs and manufactures agricultural and construction equipment under the Case IH, New Holland, and Case CE brands, selling into over 170 countries with a financial services arm that funds roughly 40% of end-market purchases. The brand portfolio carries genuine dealer loyalty in row-crop markets where switching costs are high - farmers don't retrain on new iron mid-season, and CNH's precision ag software stack deepens that stickiness over time. The near-term story hinges on the ag cycle bottoming: North American large ag equipment demand has been contracting for six consecutive quarters, and any stabilization in farm income - tied directly to corn and soybean prices recovering from their 2023-2024 lows - starts restocking the order book. At 14.4x forward earnings against a trough earnings base, the multiple compression is doing real work here, but the 32.8x trailing PE signals the current earnings are depressed, not representative of normalized power. The $13.1B market cap on a business that generated over $20B in revenue last cycle implies meaningful operating leverage if volumes recover even modestly - watch Q2 2025 order commentary for the first signal that the destocking phase is exhausting itself.