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Why Tractor Supply’s Shares Jumped

Friday - 2/1/2013, 3:31am  ET

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Tractor Supply jumped 10% today, after the company released earnings.

So what: Sales rose 3.7%, to $1.29 billion, in the quarter, coming in just ahead of estimates. But earnings jumped 15.6%, to $1.11 per share, which was well ahead of the $1.03 estimate, giving a jolt to the stock.  

Now what: Management expects continued growth of $5.07 to $5.17 billion in revenue next year, and earnings of $4.32 to $4.40 per share. The continued strong operations are good for the company, but I'm a little worried about paying up for the stock. Shares closed at $103.67 today, indicating a 23.6 forward P/E ratio at the high end of estimates, a steep price even with good growth. I'll stay away for now, and wait for a better value in the stock.

Interested in more info on Tractor Supply? Add it to your watchlist by clicking here.

This article was originally published as Why Tractor Supply’s Shares Jumpedon Fool.com

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