#4 - Deere (NYSE:DE)
Deere (DE) Deere (NYSE:DE) is being ravaged by the coronavirus. At one point, DE stock was down almost 40% for the year. The stock has been part of the recent rally but remains down over 20% for the year.
In addition to removing its previous guidance for 2020, the heavy equipment manufacturer is being forced to shut down some operations as demand erodes in the wake of the virus. Deere has a solid balance sheet with about $8 billion in excess liquidity. J.P. Morgan analyst Ann Duignan upgraded DE stock to a hold and gave the stock a price target of $140. That would essentially mean the stock will be flat from its current price.
However, a recent article in Forbes highlighted that the company had similar fortunes during the financial crisis. When the market began its rebound, DE stock advanced at a pace that was twice the rate of the broader market.
Could it happen again? Investors should certainly pay attention to China. The country has begun to lift the national mitigation regulations even in Wuhan, the epicenter of the virus. Deere makes a substantial number of direct sales in China. If that demand begins to return, it could be a harbinger of renewed demand in the United States once the economy reopens.
Stock #7 is the ultimate risk-reward play
About Deere & Company
Deere & Co engages in the manufacture and distribution of equipment used in agriculture, construction, forestry, and turf care. It operates through the following segments: Agriculture and Turf, Construction and Forestry, and Financial Services. The Agriculture and Turf segment focuses on the distribution and manufacture of a full line of agriculture and turf equipment and related service parts.
More- Current Price
- $467.53
- Consensus Rating
- Hold
- Ratings Breakdown
- 9 Buy Ratings, 11 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $444.50 (4.9% Downside)
