Tractor Supply Company $TSCO
1. Is the company undervalued?
EV/EBIT: 17.09
EV/Sales: 1.83
Price/Book: 10.9

$TSCO is a well run and remarkably consistent company. They’ve grown double digits over the last decade and returned meaningful capital back to shareholders. With that said, Tractor Supply is not the most profitable business and isn’t trading anywhere close to deep value
territory. However if management keeps executing, investors could achieve above market returns with limited downside risk.

Link to full write-up here:
Erick Mokaya's avatar
$103.7m follower assets
Our newsletter this week
Check out our weekly newsletter that covers:

  • Data that CEOs are seeing does not suggest that a downturn is imminent
  • PE and VCs with record amounts of dry powder
  • AT&T saw some delays in collections of payments

Companies covered:


A Bunch of Stocks Getting Blown Up
Here are a bunch of stocks getting absolutely blown up over the last couple of weeks/months:

Visit highsandlows.substack.com to see more
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Austin Lieberman's avatar
$484.4m follower assets
February 2022 Portfolio Update. 70% Dividend Growth 30% Tech/SaaS = 100% Awesome (and less stress)
Will share more details later, but wanted to jump back on the portfolio sharing train.

I haven't been able to share my portfolio or individual stock commentary publicly because of restrictions from my previous job.

I set this account up last week in M1 Finance (which I'm a big fan of). I did this for two reasons.

#1 I've always wanted to share my portfolio, transactions, and performance completely transparently.

#2 I've done a ton of research into dividend growth investing over the last several months and realized I was foolishly dismissing it as a strategy for people in their prime accumulation years.

My portfolio allocation is now 70% dividend growth stocks and 30% tech/SaaS. I realize I might give up a bit of upside, but as I think about investing over the next 20 to 30+ years, this will minimize the stress, emotional/behavioral mistakes, and keep investing fun because I still have exposure to exciting tech companies.

Austin, why the heck do you own dividend stocks?!?!

Great question. I own dividend growth stocks because I think they'll encourage a longer-term mindset and behavior which is something that I know will lead to better outcomes for me.

Also, sustained dividend growth can lead to some incredible compounding.

Here's a look at the 1-year, 5-year, and 10-year average dividend growth rate of these stocks from SimplySafeDividends.

Here's what a portfolio with $500 monthly contributions, 4% stock price CAGR, 13% dividend growth CAGR, and a 1.98% starting yield (the average dividend yield of the companies in my portfolio) would be with dividends reinvested after:

10-years:
Total Contributions: $60,000
Annual Dividend Income: $3,320
Portfolio Value: $87,850
Portfolio Annual Rate of Return: ~8%

20-years:
Total Contributions: $120,000
Annual Dividend Income: $30,942
Portfolio Value: $362,058
Portfolio Annual Rate of Return: ~10%

30-years:
Total Contributions: $180,000
Annual Dividend Income: $463,054
Portfolio Value: $2,533,758
Portfolio Annual Rate of Return: 14.5%

As you can see in the numbers, it takes a while for the dividend growth to kick in, but at the 20 and 30-year mark, the dividend income and portfolio value start to exponentially increase.

These are just baseline calculations so the results will definitely be different, but the point is that this type of investing is very sustainable for someone who has a job and other responsibilities outside of managing their portfolio.

It requires monthly (or even quarterly) reviews of their stocks to make sure the businesses are performing well, pay-out ratios are staying in range, and the dividend growth rate is staying on track.

There are definitely ways to outperform these examples (I think I was being a bit conservative to be fair changing the dividend growth rate to 14% from 13% drastically improves the results.

I also have 30% of the portfolio allocated to tech and SaaS names which will give me exposure to more upside with less overall volatility and stress than being 100% invested in tech/Saas.

What I've realized over the last year is that I need to remember WHY I invest. I invest to compliment my life, not consume it. This strategy will help me focus my time on what's most important. My family, my health, my job, etc while still building long-term wealth.

In the coming weeks, I intend to share a lot more detail and full write-ups on this strategy and the companies I own, but this is a good starting point.

If you want to see where I got those calculations from, check out this Youtube video (I subscribed to his Patreon to get the spreadsheet so I won't share it publicly)

Here's why I decided to use M1 Finance for this portfolio. It allows me to build "slices" or buckets of stocks, then allocate to each of them.

Here's a look into the Dividend slice which makes up 70% of the portfolio. 13 holdings, 1.98% dividend yield, with targets of 7% - 8% (these are each 4% or 5% of the entire portfolio) $FNF, $ZTS, $SNA, $TSCO, $ABBV, etc

Here's the Growth slice which makes up 30% of the portfolio. 10 holdings that I believe are dominant long-term companies allocated at 10% each (~2.5% of the overall portfolio each). $SHOP, $NOW, $COIN, $UPST, etc

The next feature is pretty cool. M1 allows me to turn "auto-investing" on which will invest any contributions or dividends according to my target allocations. To my knowledge, it won't sell securities down if they are overallocated.

This is a pretty cool feature because it takes so much emotion out of the equation for me.

I have no affiliation with M1 Finance but I have really enjoyed the platform so far.
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Alberto Wallis's avatar
$23.8m follower assets
Upcoming Earnings Calendar (Jan 24-28th) - BIG week ahead!
Hey guys! Here's the upcoming earnings calendar! Definitely a very busy week ahead. Here's what I'll be looking at:

  • $MSFT - Can Azure keep its growth rate? Will a slowdown cause a sell-off similar to the one $NFLX had?
  • $TSLA - Post earnings reaction. This is one of the few high-growth stocks that has shown relative strength. Let's see if this changes post ER.
  • $LOGI - Is demand for gaming peripherals still strong? May be an early indicator of videogaming strength.
  • $AAPL - It's always interesting to hear what Apple is doing.
  • $V - Data on consumer spending.
  • $CVX - General comments on the energy market.

If you'd like an easier way to track earnings dates, you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.

MON:

TUE:

WED:

THU:

FRI:
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Featured earnings for the week of Oct 18
Earnings season (finally) getting into full gear!

So many interesting companies announcing earnings next week. Here are is the Fincredible Featured list. View all here.

Here are some I own / or particularly interested in

$JNJ - very interested to see results in the medical devices segment. Specifically are their signs of closing the gap with $ISRG with their new platform and are elective surgeries coming back

$ISRG - flip side of the $JNJ narrative. I love it when competitors announce close to each other :)

$NFLX - international subscriber numbers

$T - update on discovery spin-off, dividend and 5G capex

$XM - $MNTV is my top 3 holding based on thesis they are making inroads in enterprise market, which $XM dominates. Big enough market for both but want some context.

A few companies like $PG on inflation numbers, but I suspect @awallis will be kinda enough to provide a MacroTalk update on this topic again

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Eric Pelnik's avatar
$285.8m follower assets
Some earnings this week:
Monday, July 20th
$IBM IBM

Tuesday, July 21st
$UAL United Airlines
$AMTD TD Ameritrade
$IBKR Interactive Brokers
$KO Coca-Cola
$UTX Raytheon
$LMT Lockheed Martin
$SNAP Snap
$PM Philip Morris

Wednesday, July 22nd
$SAVE Spirit Airlines
$PCG PG&E
$CMG Chipotle Mexican Grill
$MSFT Microsoft
$TSLA Tesla
$WIX Wix.com

Thursday, July 23rd
$ALK Alaska Air Group
$AAL American Airlines Group
$LUV Southwest Airlines
$T AT&T
$RCL Royal Caribbean Cruises
$TSCO Tractor Supply
$ETFC Etrade
$CTXS Citrix
$MAT Mattel
$TREE LendingTree
$VRSN Verisign
$TWTR Twitter

Friday, July 24th
$AXP Amex
$GT Goodyear
$VZ Verizon

Source: Yahoo Finance
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