Are Robots the Farmers of Tomorrow?

Focus on technology

In a five-minute video on its website, the company repeatedly notes how its rapidly advancing technology, not diesel-fueled horsepower, will assist Deere customers around the world to make better, faster decisions to "optimize operations" and maximize profits."

That positioning has caught the attention of other investors like ARKQ, an ETF, or exchange traded fund, "that seeks long-term growth… by investing in… autonomous technology and robotics companies…"

For example, ARKQ's biggest holding is Tesla, Inc., the world's leading electric vehicle maker. Interestingly, its second-largest holding, at $180 million, is Trimble, Inc., the Silicon Valley firm that specializes in "geospatial engineering" ­ think anything GPS-driven or GPS-connected like tractors, combines and construction equipment.

Another large ARKQ holding is, yep, Deere; it owns $76 million dollars of Deere stock. In short, Wall Street is betting that tomorrow's biggest, most autonomous ­ a $10 word meaning robotic ­ farm equipment manufacturer will be Deere.

In fact, YouTube is packed with videos of several autonomous versions of sparkling green ­ and driverless ­ John Deere tractors. And, hard as it might be to believe, some are electric and none have cabs, seats, steering wheels or drivers.

As such, tomorrow's farming, like today's manufacturing, will feature even more robots and even fewer people. Neither, after all, can go on strike.

Big beneficiary

One of that rise's biggest beneficiaries is one of Deere's biggest shareholders, Cascade Investments LLC, Microsoft founder Bill Gates' investment sidecar.

According to the May 6 online edition of thewealthadvisor.com, "Cascade owned more than 31 million shares of the farm equipment maker," worth about $10.4 billion today. (Deere isn't Cascade's only farm-linked investment. This past May, it was widely reported that the then-married Bill and Melinda Gates, owned "242,000 acres of farmland [mostly in the South] worth 'more than $690 million.'")

Farmers and ranchers continue to see Deere as the premium ­ and premium-priced ­ farm equipment manufacturer in the U.S. Investors and Deere, however, have a more expansive view of its lawn and garden, farm, forestry, landscaping and highway equipment.