Tractor Supply (TSCO, Financial) had a dominant business model before COVID, but COVID has only made it better by driving more customers into its arms and providing windfall profits that allowed them to accelerate a variety of initiatives in omnichannel as well as store upgrades and remodels. We continue to expect a premium business, that has had some long-term secular tailwinds handed to it by the pandemic should trade well above the current market multiple; however, Tractor Supply is trading just about at parity with the broader market and around the upper end of its longer-term historical range. For a great business that became sustainably better as a result of the pandemic, along with a multiple that we think is too low, we continue to hold the Company in an overweight position.
From David Rolfe (Trades, Portfolio)'s Wedgewood Partners third-quarter 2021 shareholder letter.
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