What's Going On With Tractor Supply Shares Today?

Tractor Supply Co TSCO reported second-quarter FY23 sales growth of 7.2% year-on-year to $4.18 billion, missing the consensus of $4.26 billion.

Comparable store sales increased by 2.5%, driven by comparable average ticket growth of 0.6% and comparable average transaction count increase of 1.8%.

EPS of $3.83 missed the Wall Street view of $3.92.

Gross profit increased 9.3% Y/Y to $1.51 billion, and the gross margin expanded 69 basis points to 36.2%.

The operating margin was 13.3%, and operating income for the quarter was $559.3 million.

Tractor Supply held $620.03 million in cash and equivalents as of July 1, 2023. Operating cash flow for six months totaled $782.3 million.

TSCO repurchased approximately 0.7 million shares of its common stock for $153.9 million and paid quarterly cash dividends totaling $112.8 million, returning $266.7 million of capital to shareholders in the second quarter of 2023.

Real Estate Strategy Update: TSCO is establishing a new target of 3,000 Tractor Supply stores in the U.S., an increase of 200 locations from its prior guidance. 

The company plans to periodically execute the sale-leaseback of its existing ownership of 117 stores to fund the cash required by the new development program and capture the value of its existing real estate.

Outlook: Tractor Supply cuts FY23 sales outlook from $15 billion-$15.3 billion to $14.8 billion-$14.9 billion versus the Street view of $15.17 billion.

The company also cut its FY23 EPS outlook from $10.30-$10.60 to $10.20-$10.40 against the consensus of $10.41.

TSCO expects comparable store sales growth of 1.3%-2.5% (previous 3.5%-5.5%).

Price Action: TSCO shares are trading higher by 5.34% at $225.99 on the last check Thursday.