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The Word on the Street: What Major Analysts Are Saying about Deere

Shannon Black

Can Deere Plow Its Way out of the Woods in Fiscal 2Q16?

(Continued from Prior Part)

Analyst recommendations

The consensus rating among 18 analysts covering the agriculture (DBA) equipment player Deere & Company (DE) hasn’t changed much since the beginning of 2016. Of the 26 analyst ratings released by Bloomberg in January, six gave a “buy” and “sell” ratings on the stock, and the remaining analysts gave “hold” ratings.

But in May 2016, among 23 analysts, five analysts gave “buy” ratings, six analysts gave “sell” ratings, and the remaining analysts gave “hold” ratings on the stock. The average 12-month target price of the stock has decreased slightly, from $77.3 in January to $76.1 on May 9, 2016. The stock closed at $81.45 on May 6, 2015.

Notable target price changes after Deere’s 1Q16 results

Several analysts at major investment banks (IYG) revised their targets for Deere in April 2016. Goldman Sachs (GS) downgraded its target from $94 to $87 on April 24, after Caterpillar declared its earnings. Barclays (BCS), which has an “underweight” rating on the stock, further revised its target from $65 to $63 on April 13 after Deere released presentations on market fundamentals on March 17.

Among notable upward revisions, Morgan Stanley (MS) increased its target for Deere by $1 to $67 on March 18. MS, however, maintained its “underweight” rating as the stock trades considerably higher than the target price of $67. UBS also increased its target on Deere from $81 to $82 on May 4 while maintaining its “neutral” rating.

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