Stock Under $10 with 50-100% upside potential - 14 Days FREE!

5 Rocket Stocks Worth Buying for a Q1 Rally

Stock quotes in this article: MDLZ, VMW, LNKD, MA, TSCO 

Tractor Supply

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It's been a great year for Tractor Supply (TSCO). Shares of the $6.6 billion retail chain have rallied close to 18% in the last 12 months, besting any performance the S&P 500 could turn out over that same period. Tractor Supply is a big name in niche retail, offering up everything from clothing to home and garden products, to pet care items in its 1,000 store network.

And yes, the company sells tractors too.

Tractor Supply is a niche name because its target market isn't the mainstream consumer. Instead, it caters to more rural consumers who court a country lifestyle. The firm's catch-all inventory would normally looks like a liability, but in TSCO's case, the overly diverse product mix can be forgiven -- it clearly works for the firm's demographic.

TSCO's store footprint is still relatively small. The company builds its locations in rural communities outlying major metropolitan areas, positioning that offers enough consumer concentration to support a store with the demographics that will want the products Tractor Supply sells. As more stores get opened, sales numbers should expand considerably. The firm's ability to finance new store builds with cash (rather than a mountain of debt) is commendable too. Home improvement sales continue to move higher in 2013, and they should keep dragging Tractor Supply higher too.

To see all of this week's Rocket Stocks in action, check out the Rocket Stocks portfolio at Stockpickr.

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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

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