Can Tractor Supply Sustain Growth Amid Rural Market Headwinds?

Tractor Supply Company TSCO faces a critical juncture as it balances long-term growth ambitions with mounting rural market pressures. In recent quarters, softer discretionary spending, weaker agricultural demand and weather-related disruptions have weighed on comparable store sales.

For first-quarter 2025, comps declined 0.9%, with seasonal categories underperforming amid volatile weather and delayed spring selling. Big-ticket sales, especially in categories like riding lawn mowers and outdoor power, were notably weak, pressured by macro uncertainty and cautious consumer sentiment. While the company reaffirmed its full-year guidance, visibility remains clouded as inflation continues to impact core customers in rural and farming communities.

To counter these headwinds, Tractor Supply is leaning into its strategic growth pillars, expanding its Neighbor’s Club loyalty program, enhancing supply-chain efficiency, and growing its Pet and Pro customer segments. The company continues to invest in store productivity and has accelerated its high-impact remodels and side-lot expansions. E-commerce integration remains a bright spot, with omnichannel sales gaining share, especially in pet and feed categories. These efforts aim to build deeper customer engagement and drive ticket growth despite volume softness.

Yet, the question persists: Can TSCO offset rural macro pressures with execution alone? With a stable balance sheet, a healthy free cash flow and a growing private-label mix, the foundation is solid. However, a recovery in rural demand may be critical for sustaining consistent top-line momentum in the quarters ahead.

The Zacks Rundown for TSCO

Tractor Supply shares have rallied 9.4% year to date compared with the industry’s growth of 2.8%.

From a valuation standpoint, TSCO trades at a forward price-to-earnings ratio of 26.26X, significantly higher than the industry’s 18.17X.

The Zacks Consensus Estimate for Tractor Supply’s 2025 and 2026 earnings implies year-over-year growth of 2.5% and 11%, respectively. Earnings estimates for 2025 and 2026 have been unchanged in the past 30 days. Tractor Supply currently carries a Zacks Rank #3 (Hold).

Stocks to Consider

We have highlighted three better-ranked stocks from the Retail-Wholesale sector, namely Canada Goose GOOS, Urban Outfitters URBN and Tapestry TPR.

Canada Goose is a global outerwear brand. GOOS sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for Canada Goose’s current financial year’s sales and earnings indicates growth of 2.9% and 10%, respectively, from the year-ago reported figure. TSCO delivered a trailing four-quarter negative earnings surprise of 57.2%, on average.

Urban Outfitters is a lifestyle specialty retailer that offers fashion apparel and accessories, footwear, home décor, and gift items. URBN currently flaunts a Zacks Rank #1.

The Zacks Consensus Estimate for Urban Outfitters’ current financial-year sales and earnings indicates growth of 8.5% and 22.2%, respectively, from the year-ago reported figures. URBN delivered a trailing four-quarter earnings surprise of 29%, on average.

Tapestry is the designer and marketer of fine accessories and gifts for women and men in the United States and internationally. It currently carries a Zacks Rank #2 (Buy).

The Zacks Consensus Estimate for Tapestry’s current financial-year sales and earnings indicates growth of 4.3% and 17.7%, respectively, from the year-earlier actuals. TPR delivered a trailing four-quarter earnings surprise of 10.7%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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