I wanted to revisit several articles I wrote regarding weakness in the used farming equipment industry. I wrote about how I sold John Deere (NYSE:DE), Case (NYSE:CNHI) and Agco (NYSE:AGCO). Together, these three manufacturers control 90% of the tractor market in the United States. My research still sells "sell" but the stock prices have not taken my advice.
The premise is that farmers can go to auction and buy slightly used tractors and combines for about half off. Usage is measured in hours. I use a simple rule of thumb to equate to used cars: take hours times two and add a zero. So if a tractor has 600 hours, it is about like a car with 12,000 miles. I was looking at the heavy equipment auction house Ritchie Brothers (RB). Continue Reading »