Navistar, Deere Show Big Profits : Earnings: But the heavy equipment makers fail to impress Wall Street, already looking to ’96.

Two of the nation’s largest heavy equipment makers reported stronger earnings Thursday, but Wall Street was unimpressed as investors looked ahead to what they feared would be weaker markets in the next fiscal year.

Farm equipment maker Deere & Co. reported record quarterly earnings, and truck maker Navistar International Corp. said its profits nearly doubled.

Deere reported record earnings of $180.1 million, or $2.07 a share, in its fiscal third quarter ended July 31. Sales rose to $2.7 billion from $2.3 billion a year ago.

Yet its results, up sharply from a year ago when it earned $157.7 million, or $1.82 a share, were well below Wall Street expectations of about $2.20 a share.

What’s more, Deere, the world’s biggest farm equipment maker, said it expected its fourth-quarter earnings to fall short of last year’s results because of intitiatives planned for the quarter to cut inventories of service parts and dealer used goods.

Deere stock closed down $2.50 at $83.75 on the New York Stock Exchange.

Meanwhile, Navistar International Corp. said its earnings nearly doubled in its third quarter ended July 31 to $39 million, or 43 cents a share, from $20 million, or 17 cents a share, in the year-ago period. Navistar beat Wall Street estimates of 34 cents a share.

The Chicago-based medium and heavy truck and diesel engine manufacturer said its revenue jumped 21% to $1.51 billion in its third quarter from $1.25 billion a year ago.

Navistar shares rose 12.5 cents to $13.25 on the NYSE.

William Cooke, an analyst with McDonald & Co., said there were signs the market for heavy trucks was deteriorating, noting that an independent industry research firm reported that cancellations exceeded new orders for large heavy duty trucks during the first nine days of August.

“Navistar had a good quarter and will have a good fiscal [1995] year. The concern is what’s going to happen in 1996,” Cooke said.

Buffalo, N.Y.-based Varity Corp., which makes automotive products, said its earnings from continuing operations rose to a record $32.7 million, or 78 cents a share, in its second quarter ended July 31 from $22.7 million, or 50 cents a share, a year ago.

Second-quarter sales were $572.4 million, compared to $504.3 million in the 1994 quarter.

Varity’s earnings were slightly higher than expected, but its stock slipped $1.25 to $45.25 in NYSE trading because of the softness in automobile shares, analysts said.

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German chemical producer Hoechst said its pretax profit rose 96% in the first half of 1995 to $1.44 billion, due mainly to gains in its chemicals and plastics units.

The earnings do not reflect results from Hoechst’s recently acquired U.S. pharmaceuticals company, Marion Merrell Dow. The German company said its profit in the second half of 1995 will be hurt by costs of the $7.1-billion takeover and integration of Marion Merrell Dow.

Hoechst posted total sales of about $17.7 billion, up 6.4% from the year-ago first half.