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Tractor Supply (TSCO) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3-min read

Tractor Supply (TSCO) closed at $139.21 in the latest trading session, marking a +0.69% move from the prior day. The stock lagged the S&P 500's daily gain of 1.6%. At the same time, the Dow added 1.34%, and the tech-heavy Nasdaq gained 2.26%.

Coming into today, shares of the retailer for farmers and ranchers had lost 8.45% in the past month. In that same time, the Retail-Wholesale sector lost 4.91%, while the S&P 500 lost 5.3%.

Investors will be hoping for strength from TSCO as it approaches its next earnings release. On that day, TSCO is projected to report earnings of $1.33 per share, which would represent year-over-year growth of 27.88%. Meanwhile, our latest consensus estimate is calling for revenue of $2.39 billion, up 20.26% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.29 per share and revenue of $9.97 billion. These totals would mark changes of +34.4% and +19.42%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for TSCO. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. TSCO currently has a Zacks Rank of #3 (Hold).

In terms of valuation, TSCO is currently trading at a Forward P/E ratio of 21.98. For comparison, its industry has an average Forward P/E of 11.86, which means TSCO is trading at a premium to the group.

We can also see that TSCO currently has a PEG ratio of 1.76. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Miscellaneous industry currently had an average PEG ratio of 2.99 as of yesterday's close.

The Retail - Miscellaneous industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 92, which puts it in the top 37% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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