Baird Upgrades Deere and AGCO on Expected Recovery in North America Row Crop Demand
Deere (NYSE:DE) and AGCO (NYSE:AGCO) both rose approximately 4% after Baird upgraded their ratings, citing a projected recovery in North American row crop demand by fiscal year 2027. The upgrade for Deere to Outperform with an $800 price target reflects its strong exposure to the sector, while AGCO received a similar rating bump and a new $150 target due to expected operating leverage benefits from any volume recovery. The rally in ag equipment stocks occurred amid a broader market decline as SPY fell 0.5%, suggesting that investors are rotating into agricultural machinery rather than broadly supporting industrial sectors. Deere has already gained 36% year-to-date, trading at a high P/E of 34x, while AGCO's more modest gain (10%) and lower multiple (15x) suggest it may have greater upside potential if the recovery materializes as expected.
Topics: agricultural equipment market reaction stock upgrades