Illinois-based Deere & Co.’s (DE) maintenance and production employees have voted to reject the tentative agreements, which involved over 10,000 workers at 14 U.S. facilities, the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) said.
Deere is engaged in the production of diesel engines, forestry machinery, heavy equipment, agricultural machinery, drivetrains used in heavy equipment, and lawn care equipment. (See Deere stock chart on TipRanks)
The Vice-President of Labor Relations for Deere, Brad Morris, said, “John Deere remains fully committed to continuing the collective bargaining process in an effort to better understand our employees’ viewpoints. In the meantime, our operations will continue as normal.”
The company and the UAW had reached a tentative agreement on a new six-year labor agreement on October 1. The pact involved nearly 10,100 maintenance and production employees at 12 facilities in Iowa, Illinois and Kansas.
On the same day, they had also reached a tentative agreement on another new six-year labor agreement that covered approximately 100 production and maintenance employees at Deere’s parts plants in Atlanta and Denver.
Last week, Evercore ISI analyst David Raso reiterated a Buy rating on the stock with a price target of $470 (37% upside potential).
The analyst said, “The risk of a Deere strike is clearly higher than Street/investors we have spoken with are considering.”
Overall, the stock has a Moderate Buy consensus rating based on 4 Buys, 1 Hold and 1 Sell. The average Deere price target of $417.67 implies 21.7% upside potential. Shares have gained 45.1% over the past year.
According to TipRanks’ Smart Score rating system, Deere scores an 8 out of 10, suggesting that the stock is likely to outperform market averages.
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