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For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Tractor Supply (TSCO) ten years ago? It may not have been easy to hold on to TSCO for all that time, but if you did, how much would your investment be worth today?
Tractor Supply's Business In-Depth
With that in mind, let's take a look at Tractor Supply's main business drivers.
Headquartered in Brentwood, TN, Tractor Supply Company is the largest retail farm and ranch store chain in the United States. The company focuses on recreational farmers and ranchers as well as tradesmen and small businesses. It offers a wide array of merchandise such as livestock, pet and animal products, maintenance products for agricultural and rural use, hardware and tools, lawn and garden power equipment, truck and towing products, and work apparel.
Stores of Tractor Supply are primarily located in rural areas and the suburbs of major cities, which have inside selling space of 15,000–20,000 square feet with a similar area of outside space, used to demonstrate agricultural fencing, livestock equipment and horse stalls. Petsense stores have roughly 5,500 square feet of inside selling space. For Tractor Supply retail locations, the company has a standard design for the new built-to-suit locations, including nearly 15,500 square feet of inside selling space.
Tractor Supply’s broad assortment of products is tailored to meet the regional and geographic needs of its markets. Moreover, the retailer’s full line of product offerings is supported by a strong in-stock inventory position with an average of 16,000–19,500 unique products per store.
Apart from selling nationally recognized branded merchandise, the company also markets an increasing list of products under its “private-label programs.” The latter include Masterhand and Job Smart (tools and tool chests), Dumor and Producers Pride (livestock feed) and Retriever and Paws ‘n Claws (pet foods). Further, the company recently acquired 100% stake in Petsense, to fortify its presence in the pet specialty space.
Tractor Supply operates retail stores under the names Tractor Supply Company, Del’s Feed & Farm Supply, and Petsense as well as operate websites under the names TractorSupply.com and Petsense.com. Its online selling websites are expected to offer expanded assortment of products beyond in-store as well as boost store traffic through buy online, pickup in-store and ship to store programs.
As of Mar 26, 2022, it operated 2,003 Tractor Supply stores across 49 states and 178 Petsense stores in 23 states.
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Tractor Supply ten years ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in June 2012 would be worth $4,462.06, or a gain of 346.21%, as of June 16, 2022, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 182.24% and the price of gold went up 8.19% over the same time frame.
Analysts are anticipating more upside for TSCO.
Shares of Tractor Supply have outpaced the industry in the past year on a robust surprise trend that continued in the first quarter of 2022. It marked the ninth straight quarter of earnings surprise and a eighth consecutive sales beat. Both the top and bottom line grew year over year and surpassed the Zacks Consensus Estimate. Results gained from strength in the Life Out Here Strategy and solid customer trends. Also, sturdy demand for everyday merchandise including consumable, usable and edible products as well as robust summer seasonal categories contributed to comps growth. Its e-commerce business and Neighbor's Club loyalty program bodes well. It retained its upbeat 2022 view. However, higher inflation, as well as rising transportation and freight, remains a headwind. Elevated costs, stemming from increased wage rates, also act as deterrents.
Shares have gained 7.98% over the past four weeks and there have been 13 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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