UBS Warburg downgraded Deere & Co. (DE) to hold from buy.
Analyst David Bleustein says the agricultural equipment maker's stock has limited near term upside potential. He says fiscal 2003 (Oct.) production volumes could get off to a slow start, as key farm commodity prices have pulled back from their summer highs. Bleustein notes September farm equipment industry sales are weaker, following a weak August. He thinks the primary driver of weakened corn prices is the USDA's increase in the October corn yield estimate.
Bleustein maintains his $1.20 fiscal 2002 earnings per share estimate, and the $2.50 estimate for fiscal 2003. He notes the stock outperformed the S&P 500 by 34% year-to-date. He also is keeping his $50 12-month target.