Tractor Supply: Still a Buy? (Honestly)

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Right. So, Tractor Supply. TSCO. It’s doing…well. Which is, frankly, a relief. In a world where everything seems to be simultaneously collapsing and being advertised via Instagram influencers, a bit of solid retail is…comforting. As of today, it’s up about 7% year-to-date. The S&P 500? Less than 1%. It’s like, some things are still functioning. Which is a low bar, admittedly, but I’ll take it.

And it pays a dividend. Which, let’s be honest, is the main reason anyone is looking at this. Not that I’m cynical. Okay, maybe a little. But a 4.3% increase year-over-year? That’s seventeen consecutive years of increases, people. Seventeen! I can barely commit to a Pilates class for that long.

So, the question is: is it still a buy? It feels…responsible. Which is not always a good sign in the investment world. Excitement usually involves a high degree of risk, and I’m aiming for ‘comfortably secure’ right now. Not ‘thrillingly bankrupt.’

Essentials and the Discretionary Spending Void

Apparently, people still need to feed their chickens and maintain their smallholdings, even when they’re worried about the economy. Who knew? Tractor Supply is benefiting from this. Net sales up 3.3% to $3.9 billion. Comparable store sales up 0.3%. It’s not exactly rocketing, but it’s…steady. Like a reliable friend who always shows up with tea and biscuits, even when you’ve made a terrible life decision.

Hal Lawton, the CEO, said something about a “shift in consumer spending.” Which is corporate speak for “people are buying less stuff they want and more stuff they need.” Groundbreaking, I know. But it makes sense. When you’re not sure if you’ll be able to afford avocado toast, you prioritize chicken feed. It’s basic survival instinct.

The company is also investing in things. Project Fusion (store remodels – sounds…intense), localization (making stores more relevant to local communities – good), direct sales, final-mile delivery (because who actually wants to leave the house?), and pet prescriptions. It’s a lot. It feels…ambitious. I’ve made a list of my own ambitions. It includes “learn to fold fitted sheets” and “stop online shopping after 10 pm.” Progress is slow.

Growth on the Horizon (Maybe)

Management is expecting an acceleration in same-store sales growth. 1% to 3% for fiscal 2026. Earnings per share of $2.13 to $2.23. They’re also talking about a long-term target of 3% to 5% comparable store sales growth. And 8% to 11% annualized earnings per share growth. It’s all very…optimistic. I’ve tried optimism. It usually ends in disappointment.

Of course, they admit they probably won’t hit those numbers this year. Discretionary spending is still a bit…fragile. But they think they’ll get back on track by 2027. Which feels like a lifetime away. I’ve lost three phone chargers since January.

The dividend yield is currently 1.8%. Which, let’s be honest, isn’t going to make me retire early. But it’s something. I’m currently calculating how many lattes I’d need to sell to achieve the same income. The numbers are…depressing.

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The price-to-earnings ratio is around 26. So, the acceleration in growth is already priced in. But I think it’s reasonable to believe they can achieve their targets. The assumptions don’t seem completely unrealistic. Unlike my assumption that I’ll start a daily yoga practice.

So, is it a buy? Honestly, yes. It’s a resilient business, it pays a dividend, and it’s not selling anything completely frivolous. It’s not going to make me rich, but it feels…safe. And in this economy, safe feels pretty good. Units of Cryptocurrency Lost: 0 (so far). Hours Spent Watching Charts: 7. Number of Panicked Texts to Friends: 18. Will become disciplined long-term investor: TBD.

There are risks, obviously. If discretionary spending stays down, they might have to offer more promotions, which would hurt profitability. But that’s a problem for future me. I’m focusing on the present. And right now, the present involves a slightly less anxious feeling about my portfolio. And that, my friends, is a win.

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2026-02-24 22:52