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Farm Mechanization Increases in Emerging Markets to Meet Growing Consumption Needs: Wall Street Transcript Interview with Lawrence T. De Maria, Co-Group Head of Global Industrial Infrastructure for William Blair & Company

67 WALL STREET, New York - October 13, 2012 - The Wall Street Transcript has just published its Farming Equipment, Chemicals and Products Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: High Crop Prices - Emerging Market Farm Mechanization - Crop Yield Management - U.S. Corn Crop

Companies include: CNH Global NV (CNH), Titan International Inc. (TWI), Blount International Inc. (BLT), Deere & Co. (DE), AGCO Corp. (AGCO), Titan Machinery, Inc. (TITN) and many others.

In the following excerpt from the Farming Equipment, Chemicals and Products Report, an expert analyst discusses the outlook for the sector for investors:

TWST: Does name-brand recognition matter in this sector? Does a name such as John Deere (DE) carry more weight than lesser-known names?

Mr. De Maria: It does. Name brands are important because farmers tend to stick with equipment and are very loyal purchasers. So market shares don't shift around too much, but farmers want good reliable equipment that can be serviced effectively.

A company like Deere and others with outstanding reputations are recognized globally for their service capabilities and for the quality of their equipment. Farmers who are making these big investments don't want to risk buying a product that is not going to last or that is going to need constant servicing.

TWST: What is the status of the supply chain for these companies?

Mr. De Maria: Generally, the companies are managed very well, and while there can be manufacturing hiccups from time to time, companies recognize the need for the distribution networks to have ability to service the equipment in the field, if it is so critical to the production and planning process. So they tend to keep an inventory of critical components really available so that the farmers don't lose any time while they are waiting for a part to come in.

TWST: You recently initiated coverage of Blount (BLT), and it is an "outperform." What do you like about that company?

Mr. De Maria: Blount is an interesting and underfollowed story. It has a very recurring and stable revenue stream. The company makes saw chains. Because the business is very stable, the company can reallocate resources into adjacent markets to accelerate its growth, and thus we think that in a moderate organic growth environment, the company can achieve solid double-digits earnings growth over the next few years.

TWST: And who are your other "outperforms" right now and why?

Mr. De Maria: Another "outperform" is Titan International (TWI), which manufactures wheels and tires for farm, construction and mining equipment. The company is currently consolidating the global farm tire business for agriculture and is expanding further into mining. So in agriculture, Titan has gone from a U.S. business to a U.S. and South American business, and is now entering Europe through consolidation.

We are also recommending Fiat Industrial (FI.MI), which is the 89.5% owner of CNH, and we do like the CNH subsidiary, but we also have a cyclical growth story. Over the next few years, we believe in commercial vehicles, which gives it a better growth profile.

We watch the entire agricultural value chain, and one interesting company is Titan Machinery (TITN). We don't cover it and have no recommendation on it, but it is a good read-through for the ag business in North America, in general, because it is a consolidator of the distribution assets of CNH.

TWST: Overall, what is your outlook for the sector?

Mr. De Maria: The overall outlook is slow growth but positive outlook. We believe North America will be flat next year due to some trepidation with the drought and because that market has been so strong recently. But overall, outside of North America, we do expect further growth particularly in South America and a bit slower growth in Europe.

TWST: Is there anything you're particularly worried about in terms of the sector?

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.