Bank of America just raised its EUR/USD forecast
On Wednesday, BMO Capital Markets updated its financial model for Deere & Company (NYSE:DE), leading to an increase in the price target from $425.00 to $460.00, while the firm maintained a Market Perform rating on the agricultural machinery giant. The adjustment comes after Deere’s second fiscal quarter update in April.
Analyst Joel Jackson at BMO Capital revised the future earnings estimates, slightly lowering the forecast for fiscal year 2025 ending in October (F2025E) and marginally increasing the projections for fiscal year 2026 (F2026E). The new price target reflects a forward price-to-earnings ratio of approximately 25 times the estimated earnings per share (EPS) of $18.62 for F2025E, aligning with the current P/E ratio of 25.26x. According to InvestingPro analysis, the stock is currently trading above its Fair Value, with 14 analysts revising their earnings expectations downward.
Jackson’s analysis suggests that the valuation of Deere shares may be slightly ahead of the company’s financial performance, given the assumption of peak multiples on what he considers to be trough earnings. This perspective takes into account expectations for slightly higher volumes and prices next year, as well as improved margins.
Despite the raised price target, BMO Capital’s stance remains neutral. Jackson expressed caution regarding the potential for a broad return of growers to make significant capital purchases in the near term, particularly as revenue is forecast to decline by 26% this fiscal year. The analyst’s comments indicate a belief that the stock’s current valuation may have incorporated optimistic scenarios a bit prematurely. For deeper insights into Deere’s valuation and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports, which cover over 1,400 top US stocks.
In other recent news, Deere & Company reported second-quarter earnings for fiscal year 2025 that exceeded expectations, prompting several financial firms to adjust their price targets. Truist Securities raised its target to $619, maintaining a Buy rating, while Raymond (NSE:RYMD) James increased its target to $560 with an Outperform rating. Citi and Bernstein also raised their price targets to $550 and $548, respectively, though both maintained more cautious ratings. Analysts highlighted the strong performance of Deere’s Production & Precision Agriculture segment, which contributed significantly to the earnings beat. Despite this, challenges remain, such as tariff-related costs, which are expected to impact margins in the latter half of the year. Analysts from DA Davidson noted that while Deere’s cash-flow projections remain stable, the company faces uncertainties due to tariffs. Raymond James expressed optimism about recovery prospects in the agricultural sector, citing improving farmer sentiment and commodity prices. Truist Securities also mentioned Deere’s strategic initiatives, such as early order programs and potential price increases, as positive steps for future earnings growth.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.