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Tractor Supply Company (TSCO - Analyst Report) is set to report its fourth quarter 2012 results on Jan 30. Last quarter it posted an approximately +3.0% surprise. Let’s see how things are shaping up for this announcement.

Growth Factors in the Past Quarter

The company’s impressive merchandising improvement strategy resulted in high single-digit top-line growth in the last-reported quarter. Robust performance in core consumable, usable and edible products − mainly for pet food and animal feed − acted as a catalyst for increase in the company’s same-store sales. Moreover, better cost containment related to store personnel and lower incentive compensation expenses boosted its operating margin. Further, as new construction activities are showing signs of improvement, we believe that Tractor Supply is well positioned to grab the opportunity.

Earnings Whispers?

Our proven model does not conclusively show that Tractor Supply is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 for this to happen. That is not the case here, owing to the following factors:

Zacks ESP: ESP for Tractor Supply is 0.00%. This is because the Most Accurate Estimate stands at $1.03, which is in line with the Zacks Consensus Estimate.

Zacks #3 Rank (Hold): Tractor Supply’s Zacks Rank #3 (Hold) lowers the predictive power of ESP because the Rank #3, when combined with a 0.00% ESP makes the surprise prediction difficult. We caution against stocks with Zacks #4 and #5 Ranks (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies you may want to consider. Our model shows that the following companies have the right combination of elements to post an earnings beat this quarter:

Big 5 Sporting Goods Corporation (BGFV - Analyst Report) has Earnings ESP of 5.56% and Zacks Rank #1 (Strong Buy).

Home Depot Inc.’s (HD - Analyst Report) Earnings ESP stands at 1.59% and it carries a Zacks Rank #2 (Buy).

Abercrombie & Fitch Company (ANF - Analyst Report) with Earnings ESP of 7.25%, holds a Zacks Rank #2 (Buy).

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