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Investing.com - BofA Securities upgraded Tractor Supply Company (NASDAQ:TSCO) from Underperform to Buy on Thursday, while raising its price target to $70.00 from $53.00. The retailer, currently valued at $31.7 billion, has shown strong momentum with a 13.3% gain year-to-date and trades near its 52-week high of $61.53.
The upgrade reflects BofA’s expectation that deflation headwinds will abate for the rural lifestyle retailer, with company initiatives increasing in the second half of 2025 and into 2026. According to InvestingPro data, the company maintains strong fundamentals with a 36.3% gross profit margin and has consistently paid dividends for 16 consecutive years.
BofA Securities now anticipates Tractor Supply will return to faster earnings per share growth of over 10%, prompting the firm to raise its 2026 EPS estimate to $2.40 from the previous $2.33.
The new price target is based on a price-to-earnings multiple of 29x the firm’s 2026 EPS estimate, up from the previous 22x multiple, according to the research note released Thursday.
BofA cited Tractor Supply’s high percentage of consumables, which represent 40-45% of sales, as a factor that compares favorably with leading broadline retailers that have an average P/E of 29x.
In other recent news, Tractor Supply Company reported impressive financial results for the second quarter of 2025, exceeding analysts’ expectations. The company achieved an earnings per share (EPS) of $0.81, slightly above the forecasted $0.80. Additionally, Tractor Supply recorded sales of $4.44 billion, marking a 4.5% increase compared to the previous year. These results highlight the company’s strong performance during this period. Following the announcement, investor confidence appeared to be bolstered by the positive financial outlook. The company’s achievements in this quarter demonstrate its ability to surpass market projections. These developments are among the latest updates concerning Tractor Supply.
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