NEW YORK (TheStreet) -- Deere & Company's (DE) - Get Deere & Company Report exposure to a slowdown in the farming industry clouded better-than-expected results on Tuesday.

By midmorning, shares had taken off 0.71% to $86.84.

The heavy machinery maker warned of a 3% decrease in equipment sales over fiscal 2014, and a 6% drop in the three months to April. Full-year net income is expected to be in the range of $3.3 billion, 6.7% lower than a year earlier.

Against "moderating demand for agricultural equipment," the company foresees worldwide sales of agriculture and turf equipment to decline 6% for the full year. The segment accounts for 89% of profits in its equipment sales business (excluding its financial services arm).

"Although farm incomes are expected to remain at healthy levels in 2014, they are forecast to be lower than in the previous year. In Deere's view, the decline will have a dampening effect on demand, especially for larger models of equipment," the company said in a statement.

The U.S. Department of Agriculture recently projected a steep decline in income over 2014, with net farm profits expected to drop 27% to $95.8 million, its lowest level since 2010. Over the past 12 months, decreasing prices and larger harvest for the nation's largest crops, corn and soybeans, ate into growers' profits.

UBS reiterated its "sell" rating on Deere due to its overexposure to agricultural weakness.

"We expect DE stock performance to revert to more historical norms relative to corn price performance, and we expect already lower corn prices to pressure demand for ag equipment in the year ahead. We expect DE's earnings will decline in 2014, driven by weakening ag sales, as farmers anticipate lower cash receipts," wrote analyst Steven Fisher in a note.

Deere & Co. reported a 5% increase in quarterly net income to $681.1 million. Per-share earnings were 10% higher year over year to $1.81, 29 cents more than analysts surveyed by Thomson Reuters anticipated. Including its financial services arm, revenue rose 3% to $7.65 billion.

Partially offsetting Deere's exposure to soft agricultural demand, worldwide sales of construction and forestry equipment are expected to increase 10% for the full year.

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"The gain reflects further economic recovery and higher housing starts in the U.S. as well as sales increases outside the U.S. and Canada. Global forestry sales are expected to be up for the year due to general economic growth and improved sales in European markets," the company noted.

Sharing in the profits of a housing recovery, Owens Corning (OC) - Get Owens Corning Report is soaring after the construction supplies company topped full-year estimates.

Owens Corning CEO Mike Thaman said in a statement that the company benefited from "a stable and growing global economy and a recovering U.S. housing market."

The Toledo, Ohio-based company reported full-year net income of $1.86 a share, 20 cents above consensus, and revenue 2% higher year over-year to $5.3 billion.

"We expect similar growth in 2014 and we are working to maintain the momentum we established last year," Thaman added.

Its roofing and insulation segments, in particular, are expected to drive growth on U.S. residential new construction and improved pricing.

Owens Corning shares are up 12.9% to $44.85.

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TheStreet Ratings team rates DEERE & CO as a Buy with a ratings score of A-. The team has this to say about their recommendation:

"We rate DEERE & CO (DE) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, good cash flow from operations, impressive record of earnings per share growth and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."