Stephen Volkmann: ‘Deere is a great long-term story’

As Russian forces continue to penetrate Ukraine, wheat prices climbed to a 14-year high on Friday – a development that will benefit the U.S. agriculture equipment manufacturer, Deere & Company (NYSE: DE), says Jefferies Stephen Volkmann.

Volkmann has a $450 price target on Deere & Company

The forecast is already reflecting in the stock with shares up more than 5.0% since Thursday morning when Russia launched a special military operation in Ukraine. On CNBC’s “The Exchange”, Volkmann said:

The senior machinery analyst at the independent investment bank has a price a price target of $450 on DE that represents a 30% upside from here. Last week, Deere reported Q1 earnings that easily topped estimates. The stock trades at a PE multiple of 19.23 at present.

Ukraine is more than just a beneficiary of the Ukraine crisis

Interestingly, however, Volkmann is convinced the Ukraine crisis is not the only tailwind for Deere. In fact, there are trends that make the stock particularly lucrative for the long-term investors, he added.

Deere generates roughly 25% of its business from the energy markets. The tightness in oil and gas, therefore, could also be a catalyst for the stock, Volkmann concluded, who also has a positive view on the likes of Caterpillar and Cummins.