Investors in Tractor Supply Company (NASDAQ:TSCO) had a good week, as its shares rose 8.4% to close at US$274 following the release of its quarterly results. The result was positive overall - although revenues of US$3.4b were in line with what the analysts predicted, Tractor Supply surprised by delivering a statutory profit of US$1.83 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Tractor Supply

Following the latest results, Tractor Supply's 30 analysts are now forecasting revenues of US$15.0b in 2024. This would be a reasonable 2.3% improvement in revenue compared to the last 12 months. Statutory per share are forecast to be US$10.36, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$15.0b and earnings per share (EPS) of US$10.24 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 6.4% to US$262despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Tractor Supply's earnings by assigning a price premium. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Tractor Supply analyst has a price target of US$300 per share, while the most pessimistic values it at US$205. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Tractor Supply's revenue growth is expected to slow, with the forecast 3.1% annualised growth rate until the end of 2024 being well below the historical 14% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 4.9% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Tractor Supply.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Tractor Supply going out to 2026, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Tractor Supply , and understanding them should be part of your investment process.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.