Tractor Supply: Solid Long-Term Initiatives Offset by Near-Term Macro, Demand, and Margin Headwinds Justify Hold Rating

Analyst Max Rakhlenko from TD Cowen maintained a Hold rating on Tractor Supply and decreased the price target to $53.00 from $55.00.

Max Rakhlenko has given his Hold rating due to a combination of factors tied to Tractor Supply’s current operating environment and outlook. He notes that comparable sales and margins are under meaningful pressure, with fourth-quarter results coming in softer than anticipated amid weak emergency-response demand and ongoing softness in discretionary categories. While he views the lower end of the company’s fiscal 2026 guidance as attainable, he emphasizes that performance remains highly sensitive to macro conditions and volatile trends, which limits near-term visibility. In his view, the stock is trading near the bottom of its usual medium‑term valuation range but may struggle to break out until there is clearer evidence of a sustained improvement in same‑store sales.

Rakhlenko also highlights a mixed picture between Tractor Supply’s core business and its newer growth initiatives. Emerging areas such as direct sales, last‑mile delivery, and PetRx are beginning to contribute to sales growth and should add incrementally more over time, but this is not enough to fully offset pressure in the core business, which faces headwinds from softer pet‑related demand, lack of commodity inflation, and increased dependence on favorable weather. Additionally, he flags an unexpected decline in gross margin driven by tariffs, higher transport costs, and stronger‑than‑planned promotional uptake, and he expects investor concern around margin durability to persist in the near term. Taken together, these factors support a neutral stance: the company has attractive long‑term initiatives, but near‑term macro, demand, and margin uncertainties justify maintaining a Hold rating rather than moving to a more bullish recommendation.

Rakhlenko covers the Consumer Cyclical sector, focusing on stocks such as Planet Fitness, RH, and Valvoline. According to TipRanks, Rakhlenko has an average return of 9.5% and a 61.81% success rate on recommended stocks.

In another report released yesterday, TipRanks – Anthropic also reiterated a Hold rating on the stock with a $59.00 price target.