Tractor Supply Faces Challenges with Lower Sales and Earnings

By Will Feuer

Tractor Supply, a farm and ranch retailer based in Brentwood, Tenn., experienced a decline in sales and earnings for the fourth quarter. This drop can be attributed to a decrease in demand for discretionary products and big-ticket items.

In the fourth quarter, the company reported a profit of $247.9 million, or $2.28 per share. This is lower than the profit of $270.9 million, or $2.43 per share, that was recorded during the same period the previous year. Although the earnings per share were higher than the expected $2.22, sales fell by nearly 9% to $3.66 billion, slightly below the expected $3.68 billion.

Comparable-store sales also decreased by more than 4% when compared to the previous year. This decline was primarily due to a decrease in both transaction volume and purchase amounts. The company noted that the decline in demand for cold-weather products, big-ticket items, and discretionary categories offset any strength seen in the consumable, usable, and edible category.

Looking towards 2024, Tractor Supply aims to achieve sales between $14.7 billion and $15.1 billion, aligning with analysts' expectations of $15.03 billion. This projection is higher than the reported sales of $14.56 billion for 2023. The company estimates a range of a 1% drop to a 1.5% growth in same-store sales for the year.

Regarding earnings, Tractor Supply forecasts earnings per share to be between $9.85 and $10.50. However, this falls short of analysts' projected earnings per share of $10.32.

In conclusion, Tractor Supply faces challenges with lower sales and earnings due to declining demand for certain product categories. As the company looks towards the future, they are focused on strengthening their performance.