UPDATE: Goldman Sachs Downgrades Deere on Lower US Farm Income and Capex

In a report published Friday , Goldman Sachs analyst Jerry Revich downgraded Deere (NYSE: DE) from Neutral to Sell and lowered the price target from $98 to $85 following weak cyclical outlook.

In the report, Goldman Sachs noted, "Recovering commodity inventories point to lower US farm income and capex. We forecast corn, soybean and wheat inventories to recover to historical average by the end of 2013, driving farmer realized price declines of 15-20% in 2014 from 2013 (based on corn price of $5.40). As a result, we forecast farmer sales declines of 10% and a 15% ag equipment capex cut."

Deere closed on Thursday at $89.39.