TRACTOR SUPPLY COMPANY (TSCO) Stock Fundamental Analysis
NASDAQ:TSCO - Nasdaq - US8923561067 - Common Stock - Currency: USD
TSCO gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 123 industry peers in the Specialty Retail industry. TSCO scores excellent points on both the profitability and health parts. This is a solid base for a good stock. TSCO is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year TSCO was profitable.
TSCO had a positive operating cash flow in the past year.
Each year in the past 5 years TSCO has been profitable.
In the past 5 years TSCO always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 10.30%, TSCO belongs to the best of the industry, outperforming 83.74% of the companies in the same industry.
With an excellent Return On Equity value of 43.66%, TSCO belongs to the best of the industry, outperforming 92.68% of the companies in the same industry.
TSCO has a better Return On Invested Capital (14.63%) than 84.55% of its industry peers.
TSCO had an Average Return On Invested Capital over the past 3 years of 16.60%. This is above the industry average of 12.05%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 43.66% | ||
| ROIC | 14.63% |
ROA(3y)12.04%
ROA(5y)11.91%
ROE(3y)51.11%
ROE(5y)48.41%
ROIC(3y)16.6%
ROIC(5y)16.64%
1.3 Margins
TSCO has a Profit Margin of 7.18%. This is amongst the best in the industry. TSCO outperforms 83.74% of its industry peers.
TSCO's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 9.70%, TSCO belongs to the best of the industry, outperforming 83.74% of the companies in the same industry.
In the last couple of years the Operating Margin of TSCO has grown nicely.
TSCO has a Gross Margin (36.41%) which is comparable to the rest of the industry.
TSCO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.7% | ||
| PM (TTM) | 7.18% | ||
| GM | 36.41% |
OM growth 3Y-1.33%
OM growth 5Y2.07%
PM growth 3Y-1.88%
PM growth 5Y1.9%
GM growth 3Y1.02%
GM growth 5Y1.07%
2. Health
2.1 Basic Checks
TSCO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for TSCO has been reduced compared to 1 year ago.
TSCO has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, TSCO has an improved debt to assets ratio.
2.2 Solvency
TSCO has an Altman-Z score of 5.22. This indicates that TSCO is financially healthy and has little risk of bankruptcy at the moment.
TSCO's Altman-Z score of 5.22 is amongst the best of the industry. TSCO outperforms 87.80% of its industry peers.
TSCO has a debt to FCF ratio of 2.08. This is a good value and a sign of high solvency as TSCO would need 2.08 years to pay back of all of its debts.
TSCO has a Debt to FCF ratio of 2.08. This is in the better half of the industry: TSCO outperforms 77.24% of its industry peers.
TSCO has a Debt/Equity ratio of 0.68. This is a neutral value indicating TSCO is somewhat dependend on debt financing.
TSCO's Debt to Equity ratio of 0.68 is in line compared to the rest of the industry. TSCO outperforms 46.34% of its industry peers.
Even though the debt/equity ratio score it not favorable for TSCO, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 2.08 | ||
| Altman-Z | 5.22 |
ROIC/WACC1.69
WACC8.65%
2.3 Liquidity
TSCO has a Current Ratio of 1.28. This is a normal value and indicates that TSCO is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of TSCO (1.28) is comparable to the rest of the industry.
A Quick Ratio of 0.16 indicates that TSCO may have some problems paying its short term obligations.
TSCO's Quick ratio of 0.16 is on the low side compared to the rest of the industry. TSCO is outperformed by 90.24% of its industry peers.
TSCO does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.28 | ||
| Quick Ratio | 0.16 |
3. Growth
3.1 Past
TSCO shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.74%.
Measured over the past years, TSCO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.96% on average per year.
TSCO shows a small growth in Revenue. In the last year, the Revenue has grown by 2.96%.
The Revenue has been growing by 12.25% on average over the past years. This is quite good.
EPS 1Y (TTM)-1.74%
EPS 3Y5.77%
EPS 5Y16.96%
EPS Q2Q%3.05%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y5.34%
Revenue growth 5Y12.25%
Sales Q2Q%4.55%
3.2 Future
The Earnings Per Share is expected to grow by 9.51% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.86% on average over the next years.
EPS Next Y4.08%
EPS Next 2Y7.27%
EPS Next 3Y9%
EPS Next 5Y9.51%
Revenue Next Year5.11%
Revenue Next 2Y5.79%
Revenue Next 3Y6.24%
Revenue Next 5Y6.86%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 29.17 indicates a quite expensive valuation of TSCO.
Based on the Price/Earnings ratio, TSCO is valued a bit cheaper than the industry average as 60.16% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.24, TSCO is valued at the same level.
The Price/Forward Earnings ratio is 25.35, which means the current valuation is very expensive for TSCO.
The rest of the industry has a similar Price/Forward Earnings ratio as TSCO.
The average S&P500 Price/Forward Earnings ratio is at 36.42. TSCO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.17 | ||
| Fwd PE | 25.35 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TSCO is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TSCO is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.46 | ||
| EV/EBITDA | 16.46 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TSCO does not grow enough to justify the current Price/Earnings ratio.
TSCO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)7.16
PEG (5Y)1.72
EPS Next 2Y7.27%
EPS Next 3Y9%
5. Dividend
5.1 Amount
TSCO has a Yearly Dividend Yield of 1.62%.
Compared to an average industry Dividend Yield of 5.04, TSCO pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.40, TSCO is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
5.2 History
The dividend of TSCO decreases each year by -8.25%.
TSCO has been paying a dividend for at least 10 years, so it has a reliable track record.
TSCO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-8.25%
Div Incr Years14
Div Non Decr Years14
5.3 Sustainability
TSCO pays out 44.10% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP44.1%
EPS Next 2Y7.27%
EPS Next 3Y9%
59.5
+1.87 (+3.24%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners100.21%
Inst Owner Change-0.1%
Ins Owners0.27%
Ins Owner Change3.33%
Market Cap31.55B
Analysts72.82
Price Target55.66 (-6.45%)
Short Float %8.51%
Short Ratio7.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
Yearly Dividend0.88
Dividend Growth(5Y)-8.25%
DP44.1%
Div Incr Years14
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-5.19%
Min EPS beat(2)-9.37%
Max EPS beat(2)-1.01%
EPS beat(4)0
Avg EPS beat(4)-4.35%
Min EPS beat(4)-9.37%
Max EPS beat(4)-1.01%
EPS beat(8)2
Avg EPS beat(8)-1.79%
EPS beat(12)3
Avg EPS beat(12)-1.94%
EPS beat(16)6
Avg EPS beat(16)0.45%
Revenue beat(2)0
Avg Revenue beat(2)-2.41%
Min Revenue beat(2)-3.86%
Max Revenue beat(2)-0.97%
Revenue beat(4)0
Avg Revenue beat(4)-2.38%
Min Revenue beat(4)-3.86%
Max Revenue beat(4)-0.97%
Revenue beat(8)0
Avg Revenue beat(8)-2.52%
Revenue beat(12)1
Avg Revenue beat(12)-2.26%
Revenue beat(16)4
Avg Revenue beat(16)-1.48%
PT rev (1m)0.75%
PT rev (3m)-5.22%
EPS NQ rev (1m)1.63%
EPS NQ rev (3m)-0.02%
EPS NY rev (1m)0.08%
EPS NY rev (3m)-3.83%
Revenue NQ rev (1m)0.72%
Revenue NQ rev (3m)0.58%
Revenue NY rev (1m)0.43%
Revenue NY rev (3m)-0.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.17 | ||
| Fwd PE | 25.35 | ||
| P/S | 2.08 | ||
| P/FCF | 38.46 | ||
| P/OCF | 19.64 | ||
| P/B | 12.67 | ||
| P/tB | 15.09 | ||
| EV/EBITDA | 16.46 |
EPS(TTM)2.04
EY3.43%
EPS(NY)2.35
Fwd EY3.94%
FCF(TTM)1.55
FCFY2.6%
OCF(TTM)3.03
OCFY5.09%
SpS28.57
BVpS4.7
TBVpS3.94
PEG (NY)7.16
PEG (5Y)1.72
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 43.66% | ||
| ROCE | 18.85% | ||
| ROIC | 14.63% | ||
| ROICexc | 15.07% | ||
| ROICexgc | 15.91% | ||
| OM | 9.7% | ||
| PM (TTM) | 7.18% | ||
| GM | 36.41% | ||
| FCFM | 5.41% |
ROA(3y)12.04%
ROA(5y)11.91%
ROE(3y)51.11%
ROE(5y)48.41%
ROIC(3y)16.6%
ROIC(5y)16.64%
ROICexc(3y)17.31%
ROICexc(5y)18.77%
ROICexgc(3y)18.04%
ROICexgc(5y)19.31%
ROCE(3y)21.39%
ROCE(5y)21.43%
ROICexcg growth 3Y-8.38%
ROICexcg growth 5Y1.67%
ROICexc growth 3Y-9.19%
ROICexc growth 5Y1.55%
OM growth 3Y-1.33%
OM growth 5Y2.07%
PM growth 3Y-1.88%
PM growth 5Y1.9%
GM growth 3Y1.02%
GM growth 5Y1.07%
F-Score6
Asset Turnover1.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 2.08 | ||
| Debt/EBITDA | 0.87 | ||
| Cap/Depr | 165.18% | ||
| Cap/Sales | 5.19% | ||
| Interest Coverage | 19.71 | ||
| Cash Conversion | 82.55% | ||
| Profit Quality | 75.43% | ||
| Current Ratio | 1.28 | ||
| Quick Ratio | 0.16 | ||
| Altman-Z | 5.22 |
F-Score6
WACC8.65%
ROIC/WACC1.69
Cap/Depr(3y)197.52%
Cap/Depr(5y)192.11%
Cap/Sales(3y)5.3%
Cap/Sales(5y)4.72%
Profit Quality(3y)54.61%
Profit Quality(5y)72.39%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.74%
EPS 3Y5.77%
EPS 5Y16.96%
EPS Q2Q%3.05%
EPS Next Y4.08%
EPS Next 2Y7.27%
EPS Next 3Y9%
EPS Next 5Y9.51%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y5.34%
Revenue growth 5Y12.25%
Sales Q2Q%4.55%
Revenue Next Year5.11%
Revenue Next 2Y5.79%
Revenue Next 3Y6.24%
Revenue Next 5Y6.86%
EBIT growth 1Y-1.99%
EBIT growth 3Y3.95%
EBIT growth 5Y14.58%
EBIT Next Year35.19%
EBIT Next 3Y16.87%
EBIT Next 5Y13.39%
FCF growth 1Y25.03%
FCF growth 3Y7.66%
FCF growth 5Y1.39%
OCF growth 1Y6.1%
OCF growth 3Y7.66%
OCF growth 5Y11.85%