Tractor Supply Company (TSCO - Free Report) is likely to register increases in the top and bottom lines when it reports second-quarter 2024 results on Jul 25, before market open. The Zacks Consensus Estimate for revenues is pegged at $4.3 billion, indicating a 2.3% jump from the year-ago reported figure.
The bottom line of the largest rural lifestyle retailer in the United States is expected to have risen year over year. The Zacks Consensus Estimate for earnings per share for the second quarter has been unchanged at $3.94 in the past 30 days, suggesting 2.9% growth from the year-ago period’s reported figure.
Tractor Supply has a trailing four-quarter earnings surprise of 2.7%, on average. In the last reported quarter, this Brentwood, TN-based company’s earnings missed the Zacks Consensus Estimate by 7.7%.
Tractor Supply Company Price and EPS Surprise
Tractor Supply Company price-eps-surprise | Tractor Supply Company Quote
Key Factors to Note
Tractor Supply has been experiencing momentum, driven by sturdy demand and strong market share gains. TSCO’s idea of tailoring its products to meet the everyday needs of its rural customers has gone a long way in aiding its success. The company’s offerings include farming, livestock, pet care, home improvement and outdoor living products. In addition, the execution of its everyday low-price strategy and reduced transportation are expected to continue bolstering its performance in the second quarter.
TSCO’s ability to offer high-quality products at reasonable prices makes it a preferred choice for cost-conscious rural consumers. The company has been gaining from demand for its core merchandise, including consumable, usable and edible products. The buyout of Orscheln Farm and Home, and store openings have been aiding its performance.
The company has been benefiting from its Life Out Here Strategy and the Neighbor’s Club membership program, which are likely to have driven its sales in the to-be-reported quarter. The strategy is based on five key pillars — customers, digitization, execution, team members and total shareholder return.
Tractor Supply has been focusing on its growth initiatives, including the expansion of its store base and the incorporation of technological advancements to induce traffic and drive the top line. The company’s Project Fusion and Side Lot model transformations have been significant store investments. These investments target higher market share and enhanced productivity of the existing and new stores.
TSCO’s ‘ONETractor’ strategy, which is aimed at connecting stores and online shopping, appear encouraging. Its omnichannel investments include curbside pickup, same-day and next-day delivery, a re-launched website and a new mobile app. The company’s rebranding of Petsense by Tractor Supply and the expansion of the Neighbor's Club program to Petsense stores received positive customer feedback. This move is likely to have enabled gaining pet customers for both banners.
However, Tractor Supply has been witnessing higher depreciation and amortization costs, the opening of a distribution center, the impacts of higher medical claims and inflation costs. In addition, the company is expected to have witnessed a higher SG&A expense rate resulting from planned growth investments, including increased depreciation and amortization, and modest deleveraged fixed costs.
Our model indicates a 2.9% year-over-year rise in SG&A expenses for the second quarter and a 20-bps increase in the SG&A expense rate on a year-over-year basis. Depreciation and amortization expenses are expected to increase 16.5% year over year in the second quarter.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Tractor Supply this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Tractor Supply has an Earnings ESP of -1.72% and a Zacks Rank of 4 (Sell) at present.
Stocks Poised to Beat Earnings Estimates
Here are a few companies that have the right combination of elements to post an earnings beat this time around:
Chewy (CHWY - Free Report) has an Earnings ESP of +1.61% and currently flaunts a Zacks Rank of 1. CHWY is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $2.9 billion, suggesting a 2.9% increase from the figure reported in the year-ago quarter.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for CHWY’s fiscal second-quarter earnings is pegged at 22 cents a share, up 46.7% from the year-ago quarter. The consensus mark has been unchanged in the past 30 days.
The Gap Inc. (GPS - Free Report) has an Earnings ESP of +4.39% and sports a Zacks Rank of 1 at present. GPS is likely to register top-line growth when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $3.6 billion, suggesting 2.4% growth from the figure reported in the year-ago quarter.
The consensus estimate for Gap’s fiscal second-quarter earnings is pegged at 41 cents per share, suggesting 20.6% growth from the figure reported in the year-ago quarter. The consensus estimate for earnings has been unchanged in the past 30 days. GPS has delivered an earnings beat of 202.7%, on average, in the trailing four quarters.
Costco Wholesale (COST - Free Report) currently has an Earnings ESP of +0.73% and a Zacks Rank of 2. The company is expected to register top and bottom-line growth when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $80 billion, which implies growth of 1.3% from the year-ago quarter’s reported figure.
The consensus estimate for Costco Wholesale’s earnings has increased by a penny in the past 30 days to $5.02 per share. The consensus estimate for earnings suggests growth of 3.3% from the year-ago quarter’s reported figure. COST has delivered an earnings beat of 2.3%, on average, in the trailing four quarters.
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