Tractor Supply (TSCO) Stock Forecast & Price Target

Tractor Supply has guided total sales for 2025 to increase by 5%-7%, supported by ongoing improvements in big-ticket trends and market share gains, with notable performance in key financial periods. The company's gross margin is expected to expand by approximately 20-40 basis points year-over-year, reaching 36.5%-36.7%, driven by enhanced supply chain efficiencies, strategic cost management, and growth in private brands and the retail media sector. Additionally, the average sales per store have significantly risen from $4.5 million in 2019 to $6.5 million, indicating strong operational momentum that positions the company for continued growth and profitability amidst favorable market conditions.

Tractor Supply experienced an 8.4% EBIT margin, reflecting a year-over-year decline of approximately 70 basis points, alongside an EPS of $0.44, which did not meet growth expectations due to a gross margin decline of about 10 basis points year-over-year. The company anticipates flattish EBIT margins in early fiscal 2025, as growth investments are expected to offset any gross margin improvements, leading to a flat to slightly down operating margin year-over-year. Furthermore, the warm weather late in the fiscal year adversely affected winter seasonal sales, and a deterioration in the SG&A expense ratio, coupled with strategic investments, further signals underlying operational challenges.