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Based in Brentwood, Tennessee, Tractor Supply Company (TSCO) is a leading rural lifestyle retailer. Valued at a market cap of $28.4 billion, the company primarily caters to the needs of recreational farmers and ranchers, pet owners, and landowners.
Shares of this farm retailer have underperformed the broader market over the past 52 weeks. TSCO has gained 23.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 27.5%. But, in 2024, things are looking up - shares of TSCO have gained 23.9%, surpassing SPX’s 17.6% rise on a YTD basis.
Zooming in further, TSCO has outpaced the Vaneck Retail ETF’s (RTH) 20.4% gain over the past 52 weeks and 12.1% return on a YTD basis.
TSCO’s strong stock performance in the first half of 2024 is driven by investor optimism surrounding the company’s focus on integrating its physical and digital operations through its ‘ONETractor’ strategy coupled with its persistent growth initiatives, including strategic acquisitions and expansion of its store base. However, the stock fell 1.9% following its Q2 earnings release on Jul. 25, primarily due to the company's softer-than-expected full-year guidance, which raised concerns about its ability to meet investor expectations. Despite a slight earnings beat, the revenue miss and declining comparable store sales further contributed to the negative market reaction.
For the current fiscal year, ending in December, analysts expect TSCO’s EPS to grow 1.4% year over year to $10.23.The company’s earnings surprise history is mixed. It beat the consensus estimates in three of the last four quarters while missing on one another occasion.
Among the 28 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 13 “Strong Buy” ratings, one “Moderate Buy,” 12 “Holds,” one “Moderate Sell,” and one “Strong Sell.”
Overall, the configuration has remained steady over the past months.
On Jul. 27, Telsey Advisory Group cut Tractor Supply’s price target to $300 but maintained an “Outperform” rating, noting improved earnings and operating margins of the company.
The mean price target of $271.28 represents a premium of just 3% to TSCO’s current levels. The street-high price target of $313, implies a potential upside of 18.8% from the current price.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
