Deere's Valuation in the Crosshairs: Institutional Shifts and Sector Momentum Signal Mixed Signals

In the ever-shifting landscape of industrial and technology equities, John Deere (DE) stands at a crossroads. With institutional ownership trends diverging sharply between the agricultural machinery giant and tech peers like Agilent Technologies (A), and analyst price targets oscillating between optimism and caution, the question of whether DE is undervalued relative to its peers demands a granular analysis.

Institutional Ownership: A Tale of Two Sectors

Recent institutional activity paints a stark contrast between Deere and Agilent. While Agilent's institutional ownership surged in Q3 2025-AQR Capital Management LLC and Ameriprise Financial Inc. increased stakes by 424.1% and 132.2%, respectively, according to Agilent's Q3 2025 earnings-Deere's institutional holdings tell a more fragmented story. Large players like Vanguard Group and UBS Asset Management bolstered their positions in Q1, as reported in a MarketBeat filing, but by Q3, firms such as Commonwealth Equity Services LLC and Trillium Asset Management LLC had reduced stakes by 5.8% and 7.9%, respectively, according to a separate filing. This divergence suggests that while tech investors are aggressively betting on Agilent's innovation-driven growth, industrial investors remain cautious about Deere's near-term prospects amid macroeconomic headwinds.

The institutional data also highlights sector-specific dynamics. Agilent's 34.42 P/E ratio, according to Agilent's Q3 2025 earnings,-well above Deere's 24.12, according to a MarketBeat filing-reflects a premium placed on its high-growth tech profile. Yet, Deere's industrial peers, such as CNH Industrial (P/E 14.90) and Kubota (P/E 9.98), according to a Macrotrends PE chart, trade at even lower multiples, underscoring the sector's broader struggles with weak demand and margin pressures.

Analyst Sentiment: Optimism vs. Tariff Realities

Analyst price targets for Deere reveal a tug-of-war between long-term confidence and near-term risks. As of October 2025, the consensus price target of $523.45 (based on 23 estimates) sits between bullish calls like Truist's $602 and bearish revisions like JPMorgan's $495, according to a MarketBeat filing. The optimism stems from Deere's Q3 earnings beat ($4.75 EPS vs. $4.62 estimate, according to Deere's Q3 2025 earnings) and its strategic pivot toward precision agriculture and biofuels. UBS and Oppenheimer raised targets to $535 and $566, respectively, citing 2026 harvest momentum and policy clarity, according to a MarketBeat filing.

However, the bearish camp points to tangible threats. The August 2025 expansion of U.S. steel and aluminum tariffs, reported in a Globe and Mail article, has squeezed margins across the industrial sector, with CNH Industrial reporting a 5% revenue decline in Q3, according to a Globe and Mail article. Deere's 9% revenue drop year-over-year, according to a MarketBeat filing, further fuels concerns about its ability to navigate these pressures. Analysts like DA Davidson have trimmed targets to $580, acknowledging "ongoing challenges in the global Ag Equipment cycle," according to a MarketBeat filing.

Valuation Metrics: A Relative Undervaluation?

Deere's valuation appears stretched against its industrial peers but modest compared to tech rivals. Its trailing P/E of 23.70 and forward P/E of 25.36, according to Deere's Q3 2025 earnings, exceed the sector's forward P/E of 22.7, according to FactSet Earnings Insight, yet lag behind Agilent's 34.42. This suggests investors are paying a premium for Deere's earnings resilience relative to its peers but a discount compared to high-growth tech stocks.

Revenue growth trends reinforce this nuance. Agilent's 10.1% Q3 revenue growth, according to Agilent's Q3 2025 earnings, contrasts sharply with Deere's 9% decline, according to a MarketBeat filing and CNH's 5% drop, according to a Globe and Mail article. Yet, Deere's 2025 guidance-despite JPMorgan's downgrades-points to a potential cyclical bottom. Analysts project 11.6% earnings growth for the industrial sector in CY 2025, according to FactSet Earnings Insight, a figure Deere could outpace if it executes on its innovation roadmap.

The Verdict: Undervalued or Overlooked?

Deere's valuation hinges on its ability to balance near-term challenges with long-term innovation. While its institutional ownership trends and P/E ratio suggest underperformance relative to tech peers, its earnings resilience and strategic bets on biofuels and automation could justify a re-rating. Agilent's soaring multiples, meanwhile, highlight the market's appetite for tech-driven growth-a dynamic Deere may yet tap into if it can stabilize its core business.

For now, the jury is out. Investors seeking value may find Deere's 24.12 P/E, according to a MarketBeat filing, appealing in a sector averaging 22.7, according to FactSet Earnings Insight, but only if they're willing to bet on a recovery in agricultural demand and Deere's ability to outmaneuver tariff-driven margin pressures.