In a report released today, Angel Castillo from Morgan Stanley maintained a Buy rating on Deere (DE – Research Report), with a price target of $500.00.
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Angel Castillo has given his Buy rating due to a combination of factors that highlight Deere’s strong position amidst current market uncertainties. Firstly, the company’s recent financial performance exceeded expectations, reinforcing confidence that fiscal year 2025 marks a cyclical low point, with prospects for improved profitability in subsequent cycles. Deere’s guidance for the second half of the year appears conservative, with anticipated price increases suggesting a stabilization of cost pressures by the fourth quarter of 2025.
Additionally, the company has made significant progress in aligning new product inventory with retail sales, positioning it well for future growth. Despite ongoing challenges with used product inventory, Deere’s stable pricing outlook for certain segments indicates sufficient financial support for dealers. Furthermore, the company’s leadership in Precision Agriculture is noteworthy, with strong demand and positive trends in orders and renewals. These factors, combined with the potential for a stock re-rating due to secular trends in Precision Ag, support the raised bull case scenario, reflecting a possible 30% upside.
In another report released today, Barclays also maintained a Buy rating on the stock with a $530.00 price target.