Telsey raises Tractor Supply Quote price target based on growth

Source: Investing Posted 17/10/2024, 15:41

Consulting Group Telsey on Thursday revised its outlook on Tractor Supply Company (NASDAQ:TSCO), raising its price target from $300 to $335, while maintaining the stock’s “superior performance” rating. The company’s analyst cited the company’s strong performance and dominant presence in rural America as the main reasons for the positive assessment.

Tractor Supply’s consistent performance and strategic initiatives drive analyst confidence in its long-term earnings growth. While acknowledging the short-term challenges posed by macroeconomic pressures, such as slowing inflation and normalizing demand, the company believes Tractor Supply’s fundamentals are strong.

Part of the company’s resilience is attributed to its large sales of commodities, which account for more than half of its revenue. It is expected to boost ongoing projects for Tractor Supply, such as the redesign of Project Fusion, currently in about half of its 2,254 stores, and the expansion of garden centers to the next level.

Lord of 500 stores, gains market share profitably. Moreover, the Neighbor’s Club loyalty program, which has about 36 million members, is another strategic step that is expected to contribute to the company’s success. The favorable artificial winds that emerged during the COVID-19 pandemic, such as the trend towards rural life, increased interest in home farming, and rising pet ownership, are also seen as structural changes that will continue to support sales.

The adjusted target price of $335 is based on a higher price-to-earnings (P/E) ratio of about 39 times, up from 26 times previously to the 2025 EPS estimate of $11.34. This represents a $35 increase in Tractor Supply Company’s 12-month target.

The Tractor Supply Company has been the subject of many analytical modifications. Baird maintained a “superior performance” rating with a target price of $320.

citing expectations of a strong third-quarter performance and a strong outlook.

Meanwhile, Evercore ISI downgraded Tractor Supply’s rating from “Superior Performance” to “Neutral”, citing a lower risk/reward ratio at the current valuation. Truist Securities raised its price target to $325, while maintaining a “buy” rating.

while raising the rating of “buy” Piper Sandler set the price target to $332, while retaining the “higher weight” rating.

The company reported a 2.6% year-on-year increase in earnings per share for the second quarter of 2024, to $3.93, slightly above the Fact Set consensus. However, similar store sales saw a slight decline of 0.5%. Tractor Supply revised its earnings per share guidance for the full fiscal 2024 to a range of $10.00 to $10.40.

down from the previous forecast of $9.85 to $10.50.

In addition to these financial updates, Tractor Supply continues to expand its operations.

opening 21 new stores and three Petsense locations and reporting double-digit growth in digital sales. These are the latest developments of Tractor Supply. Company.

Tractor Supply Company’s strong market position and strategic initiatives.

as highlighted by telsey Consulting Group, are also supported by recent Investing data. The company’s market capitalization is $32.66 billion, reflecting its significant presence in the rural retail sector.

Investing’s advice reveals that Tractor Supply has raised dividends for 14 consecutive years.

demonstrating its commitment to shareholder returns that are in line with its strong performance. This is particularly noteworthy given the company’s ability to maintain dividend payments for 15 consecutive years.

even during difficult economic periods.

A company’s price-to-earnings ratio of 29.08 indicates that investors are willing to pay a premium for its shares.

possibly due to its strong market position and growth prospects. This assessment is consistent with Telsey’s optimistic outlook and high price target.

In addition, Tractor Supply’s revenue for the past twelve months was $14.71 billion.

with a gross profit margin of 36.16%, indicating efficient operations and high prices and pricing in its niche market. Investing data shows an impressive total price return of 48.6-1% for one year.

reflecting market confidence in Tractor Supply’s business model and execution. This performance is in line with the analyst’s positive assessment of the company’s long-term earnings growth potential.