Will Tractor Supply spontaneously rebound?

This thesis is geared towards all Tractor Supply partners and investors who considers an exit from the corporation. I will inspect the possibilities of making Tractor Supply into a steady grower in November inspite the current mess. This firm Piotroski F Score is 5 - Healthy. Given the investment horizon of 30 days, Tractor Supply is expected to under-perform the market. In addition to that, the company is 1.24 times more volatile than its market benchmark. It trades about -0.14 of its total potential returns per unit of risk. The market is currently generating roughly 0.0 per unit of volatility. Macroaxis considers Tractor Supply to be very steady. Tractor Supply owns Efficiency Ratio (i.e. Sharpe Ratio) of -0.1448 which indicates the firm had -0.1448% of return per unit of risk over the last 1 month. Macroaxis philosophy towards measuring risk of any stock is to look at both systematic and un-systematic factors of the business, including all available market data and technical indicators. Tractor Supply Company exposes twenty-eight different technical indicators which can help you to evaluate volatility that cannot be diversified away. Please be advised to validate Tractor Supply Risk Adjusted Performance of (0.21) and Coefficient Of Variation of (715.33) to confirm risk estimate we provide.
Published over a year ago
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Reviewed by Michael Smolkin

TRACTOR SUPPLY CO currently holds roughly 105.07 M in cash with 385.38 M of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 0.88. Tractor Supply dividends can provide a clue to current valuation of the stock. The firm one year expected dividend income is about $0.59 per share. Now, lets check Tractor Supply Probability Of Bankruptcy. Based on latest financial disclosure Tractor Supply Company has Probability Of Bankruptcy of 8.91%. This is 78.47% lower than that of the Consumer Cyclical sector, and 66.78% lower than that of Specialty Retail industry, The Probability Of Bankruptcy for all stocks is 77.63% higher than Tractor Supply.
Investing in Tractor Supply, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Tractor Supply along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Tractor Supply's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Tractor Supply. Your research has to be compared to or analyzed against Tractor Supply's peers to derive any actionable benefits. When done correctly, Tractor Supply's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in Tractor Supply.

How important is Tractor Supply's Liquidity

Tractor Supply financial leverage refers to using borrowed capital as a funding source to finance Tractor Supply ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Tractor Supply financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Tractor Supply's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Tractor Supply's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Tractor Supply's total debt and its cash.

Tractor Supply Correlation with Peers

Investors in Tractor can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Tractor Supply. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Tractor Supply and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Tractor is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage. Please check volatility of Tractor for more details

Is Tractor Supply valued appropriately by the market?

The recent Tractor Supply price drops has created some momentum for investors as it was traded today as low as 93.32 and as high as 93.74 per share. The company directors and management were unable to exploit market volatilities in September. However, diversifying your overall positions with Tractor Supply Company can protect your principal portfolio during market swings. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 1.8513. The below-average Stock volatility is a good sign for a longer term investment options and for buy-and-hold investors. Tractor Supply retains profit margin of 6.71 . Tractor Supply is selling for under 93.32. That is 0.45 percent increase. Started trading at 93.32. Tractor Supply Net Cash Flow Investment Acquisitions and Disposals is increasing over the last 4 years. Moreover, Tractor Supply Net Income Common Stock USD is increasing over the last 5 years. The existing value of Tractor Supply Net Income Common Stock USD is 283,361,395.
To conclude, we believe that at this point Tractor Supply is very steady with low probability of bankruptcy within the next 2 years. Our up-to-date 'Buy/Hold/Sell' recommendation on the corporation is Hold.

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This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Rifka Kats do not own shares of Tractor Supply. Please refer to our Terms of Use for any information regarding our disclosure principles.

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