TSCO - Embedded Expectations Analysis - 2020 03 06
ï€ Tractor Supply Company (TSCO:USA) currently trades at recent averages relative to UAFRS-based (Uniform) Earnings, with a 20.5x Uniform P/E. At these levels, the market has somewhat bearish expectations for the firm, and management may be concerned about gross margins, the strength of their brands, and growth opportunitiesï€ Specifically, management may lack confidence in their ability to improve gross margins, increase their quarterly dividends, and mitigate wage and inflationary pressures. Moreover, they may be concerned about the addition of Troy-Bilt products, new brand launches, and the impact of adverse weather conditions. Furthermore, they may be exaggerating the customer acquisition opportunities their Toro brand provides, the potential of their subscription-based services, and their ability to leverage AI to foster personalized marketing campaigns. They may also lack confidence in their ability to meet updated long-term store growth targets, improve their customer service score, and attract new customers to their credit card business
Tractor Supply is a rural lifestyle retailer. The company is focused on supplying the needs of recreational farmers, ranchers and all those who enjoy living the rural lifestyle, as well as tradesmen and small businesses. The company operates retail stores under the names Tractor Supply Company, Del's Feed & Farm Supply, and Petsense and operates websites under the names TractorSupply.com and Petsense.com. The company's selection of merchandise is comprised of the following main product categories: equine, livestock, pet, and small animal products; hardware, truck, towing, and tool products; seasonal products; work/recreational clothing and footwear; and maintenance products for agricultural and rural use.
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