After an analyst meeting with farm and lawn-care equipment maker Deere & Co., a Baird U.S. Equity Research analyst said Friday the company's finances look strong, and its shares appear to be fairly valued.
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Analyst Robert McCarthy kept his "Neutral" rating and $75 price target on Deere.
"Deere appears likely to generate improved returns through the cycle and, importantly, at the next trough," McCarthy wrote in a note to investors.
"But given that potential risks to near term expectations appear unlikely to dissipate over the next couple of quarters, the current valuation appears appropriate."
McCarthy said Deere is poised to reap long-term gains from higher crop prices and increasing ethanol demand, but slowdowns in economic growth and housing demand could hurt its near-term profit.
Deere shares rose 57 cents to $78.20 in aftermarket trading on the INET electronic exchange.