Tractor Supply Company
TSCO
$32.52
+0.71%
Tractor Supply Company is the largest operator of retail farm and ranch stores in the United States, serving recreational farmers, ranchers, and rural homeowners through 2,463 namesake banners across 49 states plus 209 Petsense by Tractor Supply locations. Its merchandise mix spans livestock, equine and agriculture (roughly 27% of fiscal 2025 revenue), companion animal (24%), seasonal and recreation (24%), truck, tool and hardware (15%), and clothing, gift and décor (10%), giving it a distinctively rural, needs-based retail identity that differs sharply from urban big-box and e-commerce competitors. The current investor narrative is dominated by a severe sentiment reset: the stock has fallen roughly 45% over the past year and nearly 39% year-to-date, with headlines framing the sell-off as an overreaction to short-term margin pressure against a backdrop of solid revenue growth and reaffirmed guidance. Bulls point to the necessity-driven, defensive nature of the business, an aggressive store expansion program, and a dividend growth record, while bears focus on decelerating earnings, comp-sales softness, and the risk that rural discretionary spending remains under pressure.…
TSCO
Tractor Supply Company
$32.52
Related headlines
Investment Opinion: Should I buy TSCO Today?
Based on the synthesis, TSCO warrants a Hold rating. The core thesis is that the stock is deeply oversold with a forward PE of 15.18x and 14.1% upside to the analyst average target of $35.48, but near-term earnings visibility is poor and the technical trend remains negative. The analyst consensus is moderately bullish with 7 of 10 recent ratings positive and no sells, yet the average target implies only modest upside, reflecting cautious optimism.
Supporting evidence includes the defensive revenue mix (51% necessity categories), positive free cash flow of $307.0 million TTM, and a sustainable dividend with a 44.49% payout ratio. Revenue growth of 2.29% YoY is weak but positive, and the forward PE of 15.18x is below the trailing PE of 24.83x, suggesting a trough earnings scenario. The PS ratio of 1.75x is low for a national retailer, and the EV/EBITDA of 16.82x is not distressed. However, the debt-to-equity of 2.30 and net margin of 7.06% highlight financial risks.
The biggest risks are continued margin compression, a breakdown below the 52-week low of $28.36, and a failure to meet the $2.585 EPS consensus. The rating would upgrade to Buy if the stock stabilizes above $35 and forward PE remains below 16x with improving comps, or downgrade to Sell if revenue growth turns negative or the stock breaks below $28. The valuation appears fairly valued to slightly undervalued on a forward basis, but the trailing metrics and technical weakness suggest caution.
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TSCO 12-Month Price Forecast
The forward-looking view is neutral with medium confidence, as the stock is deeply oversold but lacks near-term catalysts. The forward PE of 15.18x suggests the market is pricing in a trough, but the earnings recovery is uncertain given decelerating revenue growth and margin pressure. Analyst sentiment is cautiously bullish, yet the wide target range ($28-$42) reflects disagreement. The low beta of 0.469 offers defense, but the technical trend is negative. An upgrade to bullish would require evidence of margin stabilization and comp-sales improvement, while a downgrade to bearish would follow a breakdown below $28.36 or another guidance cut.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Tractor Supply Company's 12-month outlook, with a consensus price target around $35.48 and implied upside of +9.1% versus the current price.
Average Target
$35.48
0 analysts
Implied Upside
+9.1%
vs. current price
Analyst Count
—
covering this stock
Price Range
$28 - $42
Analyst target range
Coverage is robust with 27 analysts following TSCO, and the consensus average target price of $35.48 implies approximately 14.1% upside from the current price of $31.09. The recommendation field returned no explicit consensus rating, but the institutional ratings data reveals a predominantly constructive tilt: of the 10 most recent ratings, six are bullish (Argus Buy, Telsey Outperform, Guggenheim Buy, Goldman Sachs Buy, Baird Outperform, Raymond James Outperform, Wells Fargo Overweight) and three are neutral (Piper Sandler, Mizuho, UBS), with no sell ratings — a distribution that leans bullish despite the stock's collapse. Notably, every single rating in the dataset is a reiteration of a prior rating with no upgrades or downgrades, indicating analysts are holding their ground rather than capitulating, which could mean either conviction in the recovery thesis or lagging acknowledgment of deteriorating fundamentals. The consensus skews moderately bullish, but the 14.1% implied upside is modest for a stock that has fallen 45% in a year, suggesting analysts see limited near-term catalysts for a sharp re-rating. The target range spans from a low of $28.00 to a high of $42.00, a spread of $14.00, or roughly 50% of the low target — a wide dispersion that signals meaningful disagreement about the company's trajectory. The high target of $42.00 implies roughly 35% upside and would require either multiple expansion back toward the mid-range of historical PE bands or evidence that the earnings recovery embedded in the $2.585 consensus EPS estimate is materializing faster than expected, potentially driven by store expansion, margin stabilization, or a rebound in rural discretionary spending. The low target of $28.00 sits just below the current 52-week low of $28.36 and implies roughly 10% downside, pricing in the risk of continued margin compression, weak comparable-store sales, or a broader consumer slowdown that forces further estimate cuts. The wide spread, combined with the fact that the average target of $35.48 is only 14% above the current price while the stock trades near its 52-week low, suggests analysts are cautiously constructive but lack high conviction — a setup that could produce sharp moves in either direction depending on the next earnings report and any guidance revision.
Bulls vs Bears: TSCO Investment Factors
The bear case currently has stronger evidence due to the severe earnings decline, decelerating revenue growth, and technical breakdown, with the stock near its 52-week low. However, the bull case rests on the defensive nature of the business, a forward PE of 15.18x that is near historical lows, and a bullish analyst consensus with 14.1% upside to the average target. The most critical tension is whether the earnings recovery implied by the $2.585 consensus EPS estimate will materialize; if it does, the stock is undervalued, but if guidance is cut again, the low target of $28.00 could be breached. The low beta of 0.469 suggests the decline is company-specific, making the resolution of margin pressure and comp-sales trends the key swing factor.
Bullish
- Defensive, necessity-driven business model: TSCO serves recreational farmers and ranchers with essential products like livestock feed and pet food, which account for roughly 51% of revenue (livestock, equine & agriculture at 27% and companion animal at 24%). This necessity-based mix provides revenue stability even in economic downturns, as evidenced by positive revenue growth of 2.29% YoY in Q2 2026 despite a 44.71% stock decline.
- Forward PE near historical lows: The forward PE of 15.18x is significantly below the trailing PE of 24.83x and near the low end of the historical range (11.3x-39.3x). This compression suggests the market is pricing in a trough earnings scenario, while the consensus EPS estimate of $2.585 implies a substantial recovery from the current trailing EPS of $0.04.
- Analyst consensus skews bullish with upside: Of 10 recent ratings, 7 are bullish (e.g., Argus Buy, Goldman Sachs Buy) and 3 neutral, with no sell ratings. The average target price of $35.48 implies 14.1% upside from $31.09, and the high target of $42.00 suggests 35% upside if the recovery materializes.
- Strong cash generation and dividend coverage: TTM free cash flow is $307.0 million, and Q2 2026 generated $328.9 million in FCF on $562.0 million operating cash flow. The dividend payout ratio of 44.49% and yield of 1.79% appear sustainable, supported by consistent capital returns ($125.6 million dividends and $135.6 million buybacks in Q2 2026).
Bearish
- Severe earnings deterioration: Q2 2026 net income fell 16% YoY to $360.7 million from $430.0 million, with EPS declining to $0.69 from $0.81. The trailing EPS of $0.04 is near zero, and the net margin compressed to 7.06% from 9.69% in the prior-year quarter.
- Revenue growth decelerating to low single digits: Q2 2026 revenue grew just 2.29% YoY to $4.541 billion, a sharp slowdown from 7.2% in Q3 2025 and 3.3% in Q4 2025. This deceleration indicates weakening comparable-store sales and limited pricing power in a mature retail category.
- High leverage and liquidity concerns: Debt-to-equity stands at 2.30, and the current ratio is only 1.34, leaving limited cushion. With $231.6 million in cash, heavy capex ($233.1 million in Q2 2026), and aggressive buybacks/dividends, the balance sheet could strain if cash flow slows.
- Technical breakdown and negative momentum: The stock trades at $31.09, just 9.6% above its 52-week low of $28.36, and has fallen 44.71% over the past year. Relative strength is negative across all periods (e.g., -59.72% vs. SPY over 1 year), and the recent 1-month decline of 10.81% shows re-accelerating weakness.
TSCO Technical Analysis
TSCO is in a pronounced, sustained downtrend, with the current price of $31.09 sitting just 9.6% above its 52-week low of $28.36 and a staggering 46.6% below its 52-week high of $58.21 — meaning the stock trades at only about 19% of its 52-week range. The 1-year price change of -44.71% and year-to-date decline of -38.84% confirm this is not a garden-variety pullback but a structural de-rating, and the maximum drawdown of -53.49% underscores the severity of the decline. Positioning this close to the 52-week low signals the market is pricing in persistent deterioration rather than a temporary dip, and while that can create value opportunities, it also carries classic falling-knife risk until a base forms. Recent momentum has deteriorated further: the 1-month change of -10.81% is sharply worse than the 3-month change of -2.11%, indicating the decline has re-accelerated after a brief summer stabilization, while the 6-month change of -29.05% shows the weakness is deeply entrenched. Relative strength is uniformly negative across every window — -11.40% versus SPY over 1 month, -5.45% over 3 months, -46.40% over 6 months, and -59.72% over 1 year — meaning TSCO has not merely fallen but has massively underperformed a rising market (SPY +15.01% over 1 year). The August rally from roughly $30 to $36.43 has fully reversed, with the stock giving back all those gains and revisiting the September lows near $31, a pattern that suggests rallies are being sold into rather than accumulated. Key technical levels are clear: support rests at the 52-week low of $28.36, and a breakdown below that level would likely trigger momentum-driven selling and open the door to new lows, while resistance sits at the 52-week high of $58.21, with intermediate resistance around the August swing high of $36.43. The beta of 0.469 is a critical offsetting factor — at less than half the market's volatility, TSCO is a low-beta defensive name, which means the -44.71% annual decline occurred despite low systematic volatility, implying the damage is company- and sector-specific rather than macro-driven. For risk management, the low beta argues for smaller position-level stop distances but also warns that the stock lacks the high-beta torque needed for a sharp mean-reversion bounce.
Beta
0.51
0.51x market volatility
Max Drawdown
-52.6%
Largest decline past year
52-Week Range
$28-$58
Price range past year
Annual Return
-39.5%
Cumulative gain past year
| Period | TSCO Return | S&P 500 |
|---|---|---|
| 1m | -7.1% | +0.9% |
| 3m | +8.0% | +3.4% |
| 6m | -27.8% | +14.4% |
| 1y | -39.5% | +16.2% |
| ytd | -36.0% | +14.0% |
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TSCO Fundamental Analysis
Revenue growth has decelerated to a crawl: the most recent quarter (ending 2026-06-27) posted revenue of $4.541 billion, up just 2.29% year-over-year, a sharp slowdown from the prior-year comparable quarter's $4.440 billion base. The multi-quarter trend shows a clear loss of momentum — Q1 2026 revenue of $3.592 billion versus Q1 2025's $3.467 billion (roughly 3.6% growth), Q4 2025 revenue of $3.898 billion versus Q4 2024's $3.774 billion (about 3.3% growth), and Q3 2025 revenue of $3.719 billion versus Q3 2024's $3.468 billion (approximately 7.2% growth) — confirming that the growth rate has compressed from mid-single digits toward the low single digits. By segment, the largest category, Livestock, Equine & Agriculture at $1.453 billion, and Seasonal & Recreation at $1.181 billion are the core revenue engines, while Companion Animal at $954 million and Truck, Tool & Hardware at $636 million provide diversification; the modest 2.29% overall growth implies these mature categories are generating little incremental lift, and the investment case now hinges on store-count expansion rather than comparable-store productivity. Profitability remains solid but is under visible pressure: Q2 2026 net income was $360.7 million on a 34.17% gross margin, down from Q2 2025's $430.0 million net income and 34.19% gross margin, a roughly 16% year-over-year earnings decline. The gross margin has oscillated meaningfully across recent quarters — 32.70% in Q1 2026, 25.60% in Q4 2025, 37.35% in Q3 2025, and 34.19% in Q2 2025 — reflecting seasonal mix and promotional intensity, while the trailing net margin of 7.06% and operating margin of 9.45% are respectable for specialty retail but leave limited cushion if comps weaken further. The most recent quarter's net income ratio of 7.94% and operating income ratio of 11.67% show sequential improvement from Q1 2026's 4.58% and 6.50%, but the year-over-year EPS decline from $0.81 to $0.69 in the comparable Q2 periods is the clearest evidence that profitability is eroding. The balance sheet carries meaningful leverage: debt-to-equity of 2.30 and a current ratio of 1.34 provide adequate but not comfortable liquidity, while the trailing ROE of 42.46% and ROA of 7.82% look strong on the surface but are flattered by the leveraged capital structure and a shrinking equity base from buybacks. Free cash flow tells a more nuanced story — TTM free cash flow is $307.0 million, and Q2 2026 generated $328.9 million in FCF on $562.0 million of operating cash flow against $233.1 million of capital expenditure, but the prior quarter (Q1 2026) burned $111.5 million of FCF as working capital swung negative. The company continues returning capital aggressively, paying $125.6 million in dividends and repurchasing $135.6 million of stock in Q2 2026 alone, funded partly by $30.0 million of debt repayment activity; with a payout ratio of 44.49% and dividend yield of 1.79%, the dividend appears covered, but the combination of heavy capex, buybacks, and dividends against a $231.6 million cash balance leaves little margin for error if cash generation slows.
Quarterly Revenue
$4.5B
2026-06
Revenue YoY Growth
+2.3%
YoY Comparison
Gross Margin
34.2%
Latest Quarter
Free Cash Flow
$306980000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is TSCO Overvalued?
Because TSCO is solidly profitable — Q2 2026 net income of $360.7 million and trailing EPS of $0.04 on a per-share basis with a positive net margin of 7.06% — the PE ratio is the appropriate primary metric. The trailing PE stands at 24.83x while the forward PE is 15.18x, a dramatic 39% compression that implies the market expects a substantial earnings recovery in the coming year, consistent with the analyst consensus EPS estimate of $2.585 versus the current depressed trailing figure. The gap between trailing and forward multiples is unusually wide and signals that investors are being asked to look through a trough earnings period, which is either an opportunity if estimates prove achievable or a value trap if guidance is cut again. Relative to the broader specialty retail sector, TSCO's forward PE of 15.18x appears modest, though the trailing PE of 24.83x and price-to-book of 10.55x represent a premium to many retail peers; the PS ratio of 1.75x and EV/Sales of 1.45x are relatively low for a national retailer with a defensive merchandise mix, while the EV/EBITDA of 16.82x and PCF ratio of 16.65x suggest the market is not pricing the stock as deeply distressed on a cash-flow basis. The PEG ratio of 25.45 is extraordinarily elevated and reflects the near-zero trailing EPS base rather than a genuine growth premium, making it a misleading metric in the current context; the more relevant comparison is the forward PE of 15.18x against the estimated EPS growth implied by the $2.585 consensus estimate. On a historical basis, TSCO's PE has ranged from roughly 11.3x (Q2 2026) to 39.3x (Q1 2025) over the past several years, with the stock typically trading in the 20x-30x band during normal periods; the current trailing PE of 24.83x sits mid-range, but the forward PE of 15.18x is near the low end of the historical band, suggesting the market is pricing in either a cyclical trough or structural deterioration. The price-to-book ratio of 10.55x is near the lower end of its historical range (which has reached 13.5x), and the PS ratio of 1.75x is dramatically below the 6x-8x levels seen in 2025, indicating a severe multiple compression that reflects both the earnings decline and a de-rating of the business's growth prospects.
PE
24.8x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 11x~39x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
16.8x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are significant, primarily due to high leverage and margin pressure. The debt-to-equity ratio of 2.30 and current ratio of 1.34 indicate a leveraged balance sheet with limited liquidity cushion, especially with only $231.6 million in cash. Q2 2026 net income fell 16% YoY to $360.7 million, and the net margin compressed to 7.06% from 9.69% a year earlier, highlighting earnings volatility. Additionally, revenue growth has decelerated to 2.29% YoY, and the business relies on store expansion rather than comparable-store productivity, which could strain returns if consumer spending weakens.
Market and competitive risks include valuation compression and sector rotation. The trailing PE of 24.83x is mid-range historically, but the forward PE of 15.18x is near the low end, reflecting pessimism; if earnings fail to recover, the multiple could contract further. The beta of 0.469 suggests low market correlation, but the stock has underperformed SPY by 59.72% over 1 year, indicating company-specific issues. Competitive threats from e-commerce and big-box retailers in rural markets could pressure market share, and any regulatory changes affecting agricultural subsidies or pet product sales could impact demand.
The worst-case scenario involves a continued decline in rural discretionary spending, leading to further earnings misses and guidance cuts. If Q3 2026 results disappoint, the stock could break below its 52-week low of $28.36 and approach the analyst low target of $28.00, representing a 10% downside from the current price of $31.09. In a more severe scenario, if the earnings recovery does not materialize and the forward PE compresses to the low end of its historical range (11.3x), the stock could fall to around $25, a 20% decline. The maximum drawdown of 53.49% over the past year illustrates the potential severity, and investors could lose 10-20% from current levels in an adverse scenario.
FAQ
The most severe risk is financial: high debt-to-equity of 2.30 and a current ratio of 1.34 leave limited liquidity cushion, with only $231.6 million in cash. Operational risk includes decelerating revenue growth of 2.29% YoY and margin compression, with net margin falling to 7.06%. Market risk is significant due to the stock's 44.71% decline and negative relative strength, with a break below $28.36 potentially triggering further selling. Competitive risks from e-commerce and big-box retailers could pressure market share, and macro sensitivity to rural spending is a concern despite the low beta of 0.469.
The 12-month forecast has a base case (55% probability) of $33-$36, assuming modest earnings recovery and stable margins, aligning with the analyst average target of $35.48. The bull case (25% probability) targets $38-$42 if earnings beat and margins expand, while the bear case (20% probability) targets $25-$28 if guidance is cut and the stock breaks support. The most likely scenario is the base case, hinging on the company meeting the $2.585 EPS consensus and maintaining its dividend. Key catalysts include Q3 earnings and store expansion progress.
TSCO appears undervalued on a forward basis, with a forward PE of 15.18x compared to a trailing PE of 24.83x and a historical range of 11.3x-39.3x. The PS ratio of 1.75x is well below the 6x-8x levels seen in 2025, and the EV/EBITDA of 16.82x is not distressed. However, the trailing PE of 24.83x and PB ratio of 10.55x suggest a premium to some retail peers. The market is pricing in a trough earnings scenario, expecting EPS to recover to $2.585, which implies significant optimism. If the recovery falters, the stock could be overvalued at current levels.
From a risk/reward perspective, TSCO is a moderate buy for patient investors, with 14.1% upside to the average analyst target of $35.48 and a forward PE of 15.18x that is near historical lows. However, the stock is in a severe downtrend, trading just 9.6% above its 52-week low, and earnings have declined 16% YoY in Q2 2026. The biggest downside risk is a break below $28.36, which could lead to further losses. It may be suitable for value investors with a long horizon who can tolerate volatility, but short-term traders should wait for technical stabilization.
TSCO is more suitable for long-term investment (minimum 2-3 years) given its defensive business model, dividend growth record, and current undervaluation. The low beta of 0.469 and necessity-driven revenue mix make it a stable holding, but the recent 44.71% decline and earnings volatility require patience. Short-term trading is risky due to the strong downtrend and negative momentum, with the stock near its 52-week low. Investors should wait for technical stabilization above $35 before considering entry, and those seeking income may appreciate the 1.79% dividend yield with a sustainable 44.49% payout ratio.