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Tractor Supply Still at It

February 09, 2012 | About:

Tractor Supply (NASDAQ:TSCO) released their results on Feb. 1, and it still looks like smooth sailing, as has been expected.

- Fourth quarter sales increased 20.1%.

- Same store sales increased 7.6%.

- Fourth quarter earnings per share increased 43.3%,

- Full-year earnings per share increased 33.8%,

After reading through the past 15 or 20 years of annual reports, driving around to visit a couple dozen of their locations, even making sure to pop in to see a grand opening of a new one, I bought and recommended the company back in October when it was about $70 per share, and it's so far so good. They had about 1,000 stores a year ago and have about 1,085 now, including a very consistent record of same-store sales increases. I gauge them to be fairly good retailers, and I bet their loyal customer base would agree with that assessment.

Upon first hearing their name, Tractor Supply Company, I thought that they would be difficult to analyze, like I would have to consider the number of tractors in America and the potential profits to be made from supplying them, but it wasn't nearly so tough. I found that the best way to look at them is to think of them as an Ace Hardware, but leaning more into the spectrum of meeting the wants and needs of rural-centered Americans — the salt-of-the-Earth folks who make up the backbone of our country, the same people who would also likely appreciate a weekend road trip to Cabela's to check out the latest selection of duck calls and fish finders.

Tractor Supply is a great place to go to buy some feed for the chickens, vaccines and other meds for the horses, fencing materials, huge bags of wild bird seed, and pretty much everything else for the people who appreciate life out in the yard, whether it's 1 acre or 1,000 acres. The people at Tractor Supply have a fairly convincing plan for growth, and a good history of accomplishing it. I plan to stick with them for some time.

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