Deere downgraded to Hold at Canaccord as large ag growth slows

As previously reported, Canaccord downgraded Deere to Hold from Buy with a price target of $400, down from $530, as industry data shows slowing unit growth for ag equipment, while dealer inventories for used equipment are building and new equipment inventory levels appear to be “rapidly normalizing.” The firm believes the environment over the medium term will constrain potential for upside to consensus expectations, but adds that any looming cyclical correction is “likely to be modest compared to historical corrections” given elevated levels of farm income, interest in technology upgrades and generally balanced inventories.