Tractor Supply Company (TSCO, Financial) contributed favorably to performance during the quarter. Demand from the Company's niche, affluent rural customer base continues to normalize in a post-Pandemic world with comparable store sales running a sterling +46% higher and total sales +65% higher compared to pre-pandemic (2019) levels. Despite historically high levels of cost inflation and aggressive reinvestment, the Company has also managed to expand margins relative to 2019, helping drive higher and sustained returns on capital. Key to much of this success has been the management's exceptional job overseeing inventories in an environment with unprecedented supply-chain disruptions. The vast majority of the Company's merchandise is sourced from North America, helping it avoid the long lead times that have hurt many trans-Pacific supply chains. Tractor Supply is an exceptional retailer, and we continue to hold it as a top position.
From David Rolfe (Trades, Portfolio)'s Wedgewood Partners fourth-quarter 2022 letter.
