Investing.com -- Baird downgraded Deere&Co (NYSE:DE) to Neutral, now viewing a more balanced risk/reward outlook after recent stock gains and a lingering uncertainty over a cyclical recovery in the agriculture sector.
The firm noted that while Deere has been proactive in managing dealer inventories and is positioned for earnings growth into 2026, further upside may be limited given its near-record valuation.
“Stock near all-time highs and valuation rightfully near all-time highs, 27 times EPS, reflecting both sizable cyclical demand compression and excellent trough margin execution, further upside will increasingly be reliant on more meaningful cyclical reacceleration,” analyst at Baird said.
Baird also moved CNH Industrial (NYSE:CNH) and AGCO Corp to Neutral, highlighting weak commodity prices, policy uncertainty, and potential cost pressures from tariffs and steel prices as challenges for the sector.
While CNH could see near-term upside with further multiple expansion, AGCO faces higher risk due to slower inventory destocking and weaker North American tractor demand.
The firm believes the first half of 2025 will mark the bottom for agricultural production but warns that visibility on a broader recovery remains low.
Related Articles
Baird downgrades Deere to Neutral amid uncertainty from agriculture sector
NVIDIA maintains 2025 CoWoS wafer production plan, says analyst Kuo
Barclays upgrades Kinder Morgan on natural gas tailwinds
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.