Tractor Supply (NASDAQ: TSCO) reported Q3 EPS of $1.62, $0.29 better than the analyst estimate of $1.33. Revenue for the quarter came in at $2.61 billion versus the consensus estimate of $2.39 billion.

Third Quarter 2020 Financial Highlights and Fourth Quarter 2020 Outlook

• Net Sales Increased 31.4%; Comparable Store Sales Increased 26.8%
• Diluted Earnings Per Share (“EPS”) Increased 58.8% to $1.62
• Company Provides Fourth Quarter 2020 Financial Outlook

Life Out Here Strategy to Drive Sustainable Growth

• Prioritizes Five Foundational Pillars Centered on Customers, Digitization, Execution, Team Members and Total Shareholder Return
• Accelerates Key Strategic Initiatives Focused on Being the Indispensable Supplier of Out Here Lifestyle Solutions
• Announces Long-Term Growth Targets, Post Cycling U.S. COVID-19 Recovery

“We were very pleased with the overall performance of our business in the third quarter, which exceeded our expectations. My sincere thanks and appreciation go out to the more than 40,000 Team Members of Tractor Supply for their extraordinary efforts to serve our customers with dedication and passion in the midst of the ongoing challenges of the COVID-19 pandemic and multiple natural disasters in the quarter. Our fundamentals are strong as we continue to gain market share across existing, new and reengaged customers. We are focused on advancing our capabilities to better serve our customers as we look to emerge from the pandemic even stronger,” said Hal Lawton, Tractor Supply’s President and Chief Executive Officer.

“Our Life Out Here Strategy builds on Tractor Supply’s strong heritage of being the dependable and convenient supplier for the Out Here Lifestyle. With a resilient business model and a differentiated and loyal customer base, we are moving at a fast pace to ensure Tractor Supply continues as a strong, relevant company for the future. Given our solid foundation along with our new strategic initiatives, we believe there are many growth opportunities ahead of us. The future is exciting as we look to drive sustainable growth and long-term value for our shareholders,” Lawton added.

GUIDANCE:

Tractor Supply sees Q4 2020 EPS of $1.37-$1.47, versus the consensus of $1.34. Tractor Supply sees Q4 2020 revenue of $2.6-2.7 billion, versus the consensus of $2.44 billion.

The impact that the COVID-19 pandemic will have on the broader economy and the Company’s fiscal 2020 results remains uncertain.

COVID-19 related costs will continue to impact the business and are estimated to be approximately $17 million to $20 million in the fourth quarter. Additionally, the Company has prioritized its Life Out Here strategic growth initiatives, which will also impact the cost structure and are estimated to be approximately $12 million to $15 million in the fourth quarter. As previously disclosed and consistent with the third quarter of 2020, the Company anticipates permanent wage and benefit changes that will cost approximately $13 million in the fourth quarter.

For fiscal 2020, the Company continues to forecast capital expenditures in the range of $300 million to $325 million and plans to open approximately 80 new Tractor Supply stores and 10 new Petsense locations.

The Company is in a very strong liquidity position with current cash and cash equivalents of approximately $1.11 billion and no amounts drawn on its $500 million revolving credit facility as of September 26, 2020.

For earnings history and earnings-related data on Tractor Supply (TSCO) click here.