Tractor Supply Company
Tractor Supply Company Fundamental Analysis
Tractor Supply Company (TSCO) shows moderate financial fundamentals with a PE ratio of 17.93, profit margin of 6.91%, and ROE of 42.57%. The company generates $15.6B in annual revenue with moderate year-over-year growth of 4.31%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 38.1/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze TSCO's fundamental strength across five key dimensions:
Efficiency Score
WeakTSCO struggles to generate sufficient returns from assets.
Valuation Score
ModerateTSCO shows balanced valuation metrics.
Growth Score
WeakTSCO faces weak or negative growth trends.
Financial Health Score
ModerateTSCO shows balanced financial health with some risks.
Profitability Score
ModerateTSCO maintains healthy but balanced margins.
Key Financial Metrics
Is TSCO Expensive or Cheap?
P/E Ratio
TSCO trades at 17.93 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, TSCO's PEG of 18.11 indicates potential overvaluation.
Price to Book
The market values Tractor Supply Company at 7.71 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 6.76 times EBITDA. This is generally considered low.
How Well Does TSCO Make Money?
Net Profit Margin
For every $100 in sales, Tractor Supply Company keeps $6.91 as profit after all expenses.
Operating Margin
Core operations generate 9.28 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $42.57 in profit for every $100 of shareholder equity.
ROA
Tractor Supply Company generates $9.27 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Tractor Supply Company generates limited operating cash flow of $1.51B, signaling weaker underlying cash strength.
Free Cash Flow
Tractor Supply Company produces free cash flow of $584.80M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.11 in free cash annually.
FCF Yield
TSCO converts 3.03% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
17.93
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
18.11
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.71
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.24
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
2.55
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.38
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.43
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.17
vs 25 benchmark
How TSCO Stacks Against Its Sector Peers
| Metric | TSCO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 17.93 | 24.18 | Better (Cheaper) |
| ROE | 42.57% | 1174.00% | Weak |
| Net Margin | 6.91% | 783.00% | Weak |
| Debt/Equity | 2.55 | 0.79 | Weak (High Leverage) |
| Current Ratio | 1.38 | 2.59 | Neutral |
| ROA | 9.27% | -8308.00% (disorted) | Weak |
TSCO outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Tractor Supply Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
60.49%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
60.68%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
28.75%
Industry Style: Cyclical, Growth, Discretionary
High Growth