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Why Deere Can Gain 25%. Yes, 25%.

In November, Deere (DE) did something it hadn't done in many, many years: It traded a new all-time high. At the time, I recommended buying its shares. The argument was partly technical--after consolidating for five years, the path of least resistance was higher--and partly due to its improving fundamentals.

Goldman Sachs analyst Jerry Revich and team recommended buying Deere's shares even earlier--in June 2016--and now they've upgraded its shares again, this time to Conviction Buy. They explain why:

The original thesis behind our upgrade to Buy in June 2016 was based on a bottoming in ag equipment capex and structurally higher margins. We believe the margin improvement part of our thesis is priced in following Deere’s announcement of further...