Tractor Supply Company TSCO reported first-quarter 2026 results, wherein the bottom and top lines missed the Zacks Consensus Estimate. While net sales increased from the year-ago period, earnings declined.
Tractor Supply posted earnings of 31 cents per share, which lagged the Zacks Consensus Estimate of 34 cents. The bottom line dipped 7.2% from the figure reported in the prior-year quarter.
Net sales grew 3.6% year over year to $3.59 billion but came below the Zacks Consensus Estimate of $3.64 billion. The rise in sales can be attributed to store openings and, to a lesser extent, higher comparable store sales (comps). Comps edged up 0.5% year over year compared with the 0.9% drop registered in the prior-year’s first quarter. The improvement reflects a 1.6% rise in comparable average ticket, partly offset by a 1% dip in the comparable average transaction count.
Tractor Supply Company Price, Consensus and EPS Surprise
Tractor Supply Company price-consensus-eps-surprise-chart | Tractor Supply Company Quote
Four out of the five product categories posted positive comps in the reported quarter, complemented by strength in big-ticket items. Companion animal performance was below the company’s average, indicating weak demand trends, category shifts and an unfavorable product mix. The company reported solid double-digit growth in digital sales.
The first-quarter results lagged expectations, reflecting a shift in consumer spending as essential categories remained resilient. Consequently, shares fell more than 6% following the quarterly results. This Zacks Rank #3 (Hold) company’s shares have lost 18.3% over the past six months against the industry’s 2.2% growth.
Nevertheless, the company was focused on executing its business fundamentals and gaining share in the farm and ranch channel. It opened productive new stores and made continued progress on Project Fusion and localization initiatives.
Tractor Supply’s Costs & Margins
Gross profit rose 3.6% year over year to $1.30 billion. The gross margin remained flat year over year to 36.2%, as effective product cost management and solid execution of an everyday low-price strategy were mitigated by elevated tariffs and delivery-related transportation costs. Our model predicted gross profit to increase 8.5% and the gross margin to expand 70 basis points (bps) to 35.9%.
Selling, general and administrative (SG&A) expenses, including depreciation and amortization, rose 6.1% to $1.07 billion from $1.01 billion in the first quarter of 2025. As a percentage of net sales, SG&A increased 70 bps to 29.7% from 29% in the year-ago quarter. This increase was owing to deleveraged fixed costs based on comps performance and an accelerated new store opening cadence, somewhat offset by a focus on productivity and cost control. Our model predicted SG&A expenses to increase 7.4% and, as a percentage of sales, this metric was anticipated to expand 50 bps to 26.1%.
Operating income for the quarter fell 6.3% year over year to $233.4 million. Meanwhile, the operating margin contracted 70 bps to 6.5%. We estimated operating income to drop 6.1% and the operating margin to fall 40 bps 6.8%.
TSCO’s Financial Position
Tractor Supply ended the quarter with cash and cash equivalents of $224.3 million, long-term debt of $2.13 billion and total stockholders’ equity of $2.51 billion. In first-quarter 2026, net cash provided by operating activities was $91.1 million. In the same period, the company incurred capital expenditures of $202.6 million.
During first-quarter 2026, Tractor Supply returned $244.4 million to shareholders. This included the repurchase of 2.3 million shares of its common stock for $118 million and the payment of $244.4 million in quarterly cash dividends.
In the reported quarter, the company continued to expand its footprint by opening 40 Tractor Supply outlets, while closing one Petsense by Tractor Supply store.
Sneak Peek Into TSCO’s Outlook
Management reiterated guidance for 2026. The company still expects net sales growth of 4-6% and comps growth of 1-3%.
For 2026, the operating margin rate is projected between 9.3% and 9.6%. Net income is expected to be between $1.11 billion and $1.17 billion, with earnings per share (EPS) anticipated to be $2.13-$2.23.
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