- Price
- $32.88
- Fair value
- $42.00
- Discount
- 21.7%
- Uncertainty
- Medium
- LSEG rating
- 2.29
- Moat
- Wide
- Next earnings
- 2026-10-23
- Next earnings is estimate
- Yes
- Company name
- Tractor Supply
- Sector
- Specialty retail
- About
- Tractor Supply is the largest rural lifestyle retailer in the US. At June 27, 2026, it ran 2,463 Tractor Supply stores in 49 states and 209 Petsense pet stores. It sells to hobby farmers, ranchers, homeowners, gardeners and pet owners. In the first half of 2026, livestock, equine and farm products such as feed, poultry and fencing gave 31% of net sales, seasonal and recreation products such as lawn and garden and power equipment 23%, companion animal products 23%, truck, tool and hardware 15%, and clothing and gifts 8%. Many of these products, such as feed and pet food, are needs-based goods that customers buy again and again. It also owns Allivet, an online pet pharmacy, and since May 2026 VIP Petcare, the largest provider of mobile veterinary clinics in the US. Tractor Supply makes money from the margin on the goods it sells, and it opens new stores each year.
- Thesis
- The market prices Tractor Supply lower because its growth stopped and management cut its plans. Comparable store sales fell 1.5% in Q2 2026 because fewer customers came to the stores. In May 2026, seasonal and big-ticket items sold poorly, and companion animal sales stayed below the company average. On July 23, 2026, the company cut its 2026 outlook for comparable store sales to minus 1% to flat, from growth of 1% to 3%, and it cut adjusted EPS to $1.90 to $2.00. It also withdrew the long-term financial targets from its December 2024 Investor Day and will close about 75 Petsense stores. Investors now doubt that the store growth and the pet business can lift profit as planned. For the gap to close, three things must be true. Comparable store sales must turn positive again, with growth in transactions, in the second half of 2026. The companion animal business, with the new VIP Petcare clinics, must grow at least at the company average. The new long-term framework with the Q4 2026 report must show a credible path back to profit growth. The tests are the Q3 2026 report, expected in late October 2026, and the Q4 2026 report with the new framework in early 2027. If these checks pass, the gap can close over the next four to six quarters. The main risk is that weak spending on discretionary and big-ticket items lasts into 2027.
- Risks
- Fewer customers come to the stores. Comparable transactions fell 1.7% in Q2 2026, and seasonal, big-ticket and discretionary items sold poorly. If rural consumers keep cutting this spend, sales and margins can fall more.
Companion animal products give about 23% of net sales, and their sales grew less than the company average in the first half of 2026. The Petsense restructuring and the VIP Petcare purchase must work to win back pet owners.
Management withdrew its long-term targets in July 2026 and will give new ones only with the Q4 2026 report. Some leaders changed roles after the Chief Technology Officer left in August 2026. Investors have no clear plan until early 2027.
Tariffs and freight costs can raise the cost of imported goods. In Q2 2026, tariff-related benefits helped gross margin, but higher freight expense and price investments offset part of them.
Debt rose to $2.17 billion at June 27, 2026, from $1.78 billion at December 27, 2025, because the company borrowed more under its credit line while it bought back shares. The amount is small compared with its operating income.
- Balance sheet
- Cash: $232M
Debt: $2.2B
Net debt: $1.9B
Interest cover: 19×
Undrawn credit line: $641M
Debt due within 12 months: $0.0M
Tractor Supply funds itself with unsecured senior notes and a revolving credit facility. At June 27, 2026, debt was $750 million of 5.25% notes due 2033, $650 million of 1.75% notes due 2030, $150 million of 3.70% notes due 2029 and $620 million drawn on the revolving credit facility. The revolving credit facility was amended on May 19, 2026, and allows up to $1.30 billion; undrawn credit is that amount less the drawn part and $38.6 million of letters of credit. Debt does not include operating lease liabilities for the leased stores. Interest cover is operating income divided by net interest expense for the first half of 2026. On August 25, 2026, the company issued $500 million of 5.200% notes due 2032 to repay borrowings under the credit facility. In Q2 2026, it bought back 3.9 million shares for $135.3 million and paid $125.6 million of dividends, and it pays $0.24 per share each quarter.
As of 2026-06-27.
- Checkpoints
- Oct 23, 2026 (estimate): Q3 2026 results: comparable store sales. Pending. Watch: Positive comparable store sales with more transactions and a kept 2026 outlook pass; a further cut to the outlook fails.
Jan 2027 (estimate): Q4 2026 results and new long-term framework. Pending. Watch: A framework with comparable sales growth and margin targets near the old ones passes; much lower growth targets fail.
- Recent events
- 2026-08-25: Tractor Supply issued $500 million of 5.200% senior notes due 2032. It uses the money to repay borrowings under its revolving credit facility.
2026-08-03: Robert Mills, the Chief Technology Officer who also led digital and pet services, resigned from August 7, 2026. Seth Estep, the Chief Merchandising Officer, took over Allivet and VIP Petcare, and John Ordus, the Chief Stores Officer, took over Petsense.
2026-07-23: Tractor Supply reported Q2 2026 results. Net sales grew 2.3% to $4.54 billion, but comparable store sales fell 1.5%, with 1.7% fewer transactions. Adjusted EPS was $0.81. It recorded $65.8 million of charges to restructure Petsense, with about 75 store closures. It cut its 2026 outlook to adjusted EPS of $1.90 to $2.00 and withdrew its long-term financial framework. It will give a new framework with its Q4 2026 report.
2026-05-28: Tractor Supply bought VIP Petcare from PetIQ for $133.8 million. VIP Petcare runs community veterinary clinics in about 2,700 retail locations, including 1,700 Tractor Supply stores, and serves more than one million pets each year.
2026-05-19: Tractor Supply amended its senior credit facility, with a $1.30 billion revolving credit line.
2026-04-21: Tractor Supply reported Q1 2026 results. Net sales grew 3.6% to $3.59 billion, and comparable store sales grew 0.5%. Diluted EPS was $0.31. It kept its 2026 outlook of 1% to 3% comparable store sales growth and diluted EPS of $2.13 to $2.23.