Wolfe Research initiated coverage of Tractor Supply (NASDAQ:TSCO) with an Outperform rating and $239 price target in a note this week.
Wolfe analysts told investors in a note that the company is "above the competition," and while near-term headwinds are a concern, there are opportunities abound.
"Home improvement and pet retail sectors are both coming out of pandemic-induced slumps and investors are uncertain when growth finally normalizes. A tighter consumer wallet has also driven lower discretionary and big-ticket sales across the consumer retail landscape and at TSCO," they wrote.
"While we are cognizant of these headwinds, we expect TSCO to continue outperforming industry trends through its own strategic initiatives," they added. "Tractor Supply continues to experience positive same-store sales growth in 2023 despite broader industry headwinds. Favorable rural positioning, remodel tailwinds, improving store rollout plans, and a resilient customer base all provide potential for share performance to exceed peers even in an industry downturn."
The analysts also stated they view the company's valuation as favorable and muted expectations set the stock up nicely from here.