Here's How Much a $1000 Investment in Tractor Supply Made 10 Years Ago Would Be Worth Today

·4 min read

For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.

Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.

What if you'd invested in Tractor Supply (TSCO) ten years ago? It may not have been easy to hold on to TSCO for all that time, but if you did, how much would your investment be worth today?

Tractor Supply's Business In-Depth

With that in mind, let's take a look at Tractor Supply's main business drivers.

Headquartered in Brentwood, TN, Tractor Supply Company is the largest retail farm and ranch store chain in the United States. The company focuses on recreational farmers and ranchers as well as tradesmen and small businesses. It offers a wide array of merchandise such as livestock, pet and animal products, maintenance products for agricultural and rural use, hardware and tools, lawn and garden power equipment, truck and towing products, and work apparel.

Stores of Tractor Supply are primarily located in rural areas and the suburbs of major cities, which have inside selling space of 15,000–20,000 square feet with a similar area of outside space, used to demonstrate agricultural fencing, livestock equipment and horse stalls. Petsense stores have roughly 5,500 square feet of inside selling space. For Tractor Supply retail locations, the company has a standard design for the new built-to-suit locations, including nearly 15,500 square  feet  of  inside  selling  space.

Tractor Supply’s broad assortment of products is tailored to meet the regional and geographic needs of its markets. Moreover, the retailer’s full line of product offerings is supported by a strong in-stock inventory position with an average of 16,000–19,500 unique products per store.
 
Apart from selling nationally recognized branded merchandise, the company also markets an increasing list of products under its “private-label programs.” The latter include Masterhand and Job Smart (tools and tool chests), Dumor and Producers Pride (livestock feed) and Retriever and Paws ‘n Claws (pet foods). Further, the company recently acquired 100% stake in Petsense, to fortify its presence in the pet specialty space.

Tractor Supply operates retail stores  under  the  names  Tractor Supply Company, Del’s Feed & Farm Supply, and Petsense as well as operate websites under the names TractorSupply.com and Petsense.com.  Its online selling websites are  expected  to  offer  expanded  assortment of products beyond in-store as well as boost store traffic through buy online, pickup in-store and ship to store programs.

As of Mar 27, 2021, the company operated 1,944 Tractor Supply stores across 49 states and 177 Petsense stores in 23 states.

Bottom Line

Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Tractor Supply, if you bought shares a decade ago, you're likely feeling really good about your investment today.

According to our calculations, a $1000 investment made in May 2011 would be worth $6,071.42, or a 507.14% gain, as of May 17, 2021. Investors should keep in mind that this return excludes dividends but includes price appreciation.

The S&P 500 rose 212% and the price of gold increased 19.31% over the same time frame in comparison.

Analysts are forecasting more upside for TSCO too.

Shares of Tractor Supply have outpaced the industry in the past three months driven by a robust surprise trend. The company’s earnings and sales beat estimates in first-quarter 2021, marking the fifth straight earnings beat and fourth consecutive sales beat. Results gained from robust sales and comps growth, as well as solid margins. Comps were aided by demand for seasonal categories as well as everyday merchandise, including consumable, usable and edible products. E-commerce sales grew triple-digits in the first quarter. Management raised its 2021 view. Als, the company’s Life Out Here and ‘ONETractor’ strategies bode well. However, incremental costs related to COVID-19 and higher incentive compensation led to higher SG&A expenses. Also, higher freight costs and fuel expenses are likely to persist in 2021.

The stock is up 6.18% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 13 higher, for fiscal 2021. The consensus estimate has moved up as well.
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