The consensus analyst’s estimates for TSCO’s earnings next year currently stand at $2.63 per share. The consensus average five-year earnings growth estimate for TSCO is 17% per year.
Given these expectations, the shares currently sport an okay PEG ratio of 1.50. PEG ratio is just one valuation measure, however.
When we take that estimate of $2.63 per share and extrapolate it out over the next five years, we come up with potential earnings per share of $4.94 five years from now.
When I apply a multiple that I think is appropriate for the shares, I come up with a five year target price of $124 per share. With the stock currently trading at $68.27, I still see considerable upside potential.
Lastly, TSCO has a very healthy one-year stock chart. See for yourself!
I may have never before seen a TSCO TV commercial, ad, or even a store, but TSCO’s concept has obviously worked! Of the 3,567 stocks that I track, TSCO currently comes in at #8. It also earns a very hard-earned grade of A+. This represents the top 3% of the entire market. I only consider stocks that have a grade of A- or better. Tractor Supply easily makes the grade!
TSCO is for moderate riskinvestors. I always have a well-diversified portfolio of 25-30 stocks to mitigate my risk.
I am also very vigilant on daily basis on the stocks that I own. At the current time, clients of Gunderson Capital Management are long the stock.
Please follow me on Twitter @billgunderson for a change in opinion of the stock.
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