Tractor Supply: Valuation Update – Tractor Supply Company (NASDAQ:TSCO)

Since May, I have been highly bullish on Tractor Supply’s (TSCO) prospects and viewed it as a great opportunity for Value, GARP, and DGI investors. On August 7th, I projected that the stock would provide annualized total returns north of 15% to buyers at the current price (~$57 per share). Since then, the stock has returned ~20%, with book value per share increasing 2% to $10.92 and TTM EPS growing 1.5% to $3.37 along with increasingly robust growth prospects (comps surged to 6.6% last quarter with double-digit revenue growth). Given the stock’s rebounding price, it doesn’t appear to offer the same value to prospective investors as it did only a few months ago, yet fundamentals have improved. So, is it still a buy? I believe it is now a hold for Value and DGI investors, though it is still a buy for GARP investors in today’s overvalued market.

After TSCO delivered a strong Q3 on top of its rebound in Q2, TSCO’s moat appears to be stronger than ever, even as the retail space…

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