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Wells Fargo Downgrades Deere (DE) to Underperform; Increasingly Bearish

March 20, 2013 7:18 AM EDT Send to a Friend
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Price: $83.32 -0.5%

Rating Summary:
    4 Buy, 8 Hold, 10 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 10 | Down: 21 | New: 42
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Wells Fargo downgraded Deere (NYSE: DE) from Market Perform to Underperform with a price target to $90-93 from $72-75 saying they have turned increasingly bearish on the outlook for F2014 and F2015 US large farm equipment demand, based on short- and longer-term commodity cycle views.

Analyst Andrew Casey states: "While we believe DE is a great company whose management we hold in high regard, we believe the stock can be pressured in two ways: (1) DE's stock price tends to be influenced by corn prices, which we expect will decline in an anticipated mean reversion crop and an exit from a once every 30-year price spike, and (2) with a bearish view of 2014 and 2015 equipment demand, we now expect substantial downward estimate revision potential."

The firm maintained FY2013 EPS estimate of $8.55 (consensus $8.54), decreased FY2014 estimate to $8.00 from $9.05 (consensus $8.99) and introduced FY2015 of $6.90 (consensus $9.89).

For an analyst ratings summary and ratings history on Deere click here. For more ratings news on Deere click here.

Shares of Deere closed at $90.57 yesterday.




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