-- Tractor Supply (TSCO) reported first-quarter results that missed Wall Street's projections amid a below-average performance of its companion animal product business, sending the retailer's shares tumbling on Tuesday.
Per-share earnings for the quarter ended March 28 fell to $0.31 from $0.34 a year earlier and missed the FactSet-polled consensus of $0.34. Net sales grew 3.6% to $3.59 billion, but fell short of analysts' $3.63 billion estimate. Comparable store sales improved by 0.5%, while the Street projected 1.6% growth.
Tractor Supply provides supplies for hobby farmers, ranchers, pet owners, homeowners and gardeners.
The stock was trading 9.6% lower intraday, and has slumped about 19% so far this year.
"Companion animal performance reflects a number of structural headwinds. Sales were below the chain average," Chief Executive Hal Lawton said during an earnings call, according to a FactSet transcript. "Dog ownership, particularly in larger breeds, has come under pressure and our mix remains heavily weighted towards dog."
Describing the retail environment as "cautious but stable," Lawton said spending is focused on "needs and small indulgences, with some evidence of trip consolidation within farm and ranch."
"With the exception of companion animal, our consumable, usable and edible categories delivered consistent performance in line with our expectations led by poultry feed, bedding, livestock feed, and equine feed," Lawton told analysts.
For 2026, the company continues to expect EPS of $2.13 to $2.23, and sales growth of 4% to 6%. Analysts are looking for full-year EPS of $2.18 on sales of $16.32 billion, which implies a 5.1% annual rise from 2025.
Full-year comparable sales are projected to grow 1% to 3% this year, while analysts are looking for a 2% increase.
"Consistent with our outlook as we enter the year, we expect stronger EPS growth in (the second and fourth quarters) given the prior year's comparison on tariffs," Chief Financial Officer Kurt Barton said on the call. "The current environment remains fluid. We are managing the business based on what we know today, and have not assumed any incremental benefit from refunds in our outlook."
The first-quarter shortfall raises some earnings risk for the year, Truist Securities said in a note.
"Weather-related performance swings can be sharp for Tractor and a key reason why investors evaluate this (company) in halves rather than quarters," Truist Managing Director Scot Ciccarelli wrote. "However, the softness in pet food suggests that the (the first-quarter) shortfall may not have been driven as much by weather."
Price: $40.63, Change: $-4.18, Percent Change: -9.33%