Lowe’s vs Tractor Supply: Which NNN Investment Wins?

Lowe’s and Tractor Supply are two retailers that appear in net lease listings, and in our ratings database both are classified as investment grade: Lowe’s Companies, Inc. is rated BBB+/Baa1 and Tractor Supply Company is rated BBB/Baa1 (S&P / Moody’s), as of the check date shown under the table. In the listings we track, Lowe’s asks a live median cap rate of 5.63% across 4 listings, versus 6.10% across 39 listings for Tractor Supply.

This comparison applies the framework from our investment grade guide: credit first, then lease structure, then the real estate. The two companies are close on credit, but the buildings are very different: a home improvement big box of well over 100,000 square feet versus a rural lifestyle store that is a fraction of that size.

Lowe’s vs Tractor Supply: Head-to-Head Comparison

Ratings per our tenant ratings database. Lowe’s: Ratings checked October 8, 2026. Tractor Supply: Ratings checked October 8, 2026. Store counts, ownership percentages, store sizes and lease terms are from the companies’ Form 10-K filings as labeled. Median asking cap rates, counts, ranges, prices and last-observed dates are live values from the active listings InvestmentGrade.com tracks; a few cap rates are calculated from a listing’s stated price and income rather than stated in the listing. Asking cap rates are not closing cap rates.

Credit: One Notch Apart at S&P

Lowe’s Companies, Inc. is rated BBB+/Baa1 (S&P / Moody’s) in our ratings database and Tractor Supply Company is rated BBB/Baa1. The two carry the same Moody’s rating, and Lowe’s is one notch higher at S&P. Both are above the BBB‑/Baa3 threshold. The full profiles are on the Lowe’s credit rating and cap rate page and the Tractor Supply credit rating and cap rate page, and both tenants can be benchmarked in our credit tenant ratings database.

For either company, the rating applies to a lease only if the rated entity signs or guarantees it. A rating also does not assure that a particular store stays open or that a lease is renewed. With the credit this close, the decision moves to the lease, the building and the location.

Lease Structure: Owned Big Box vs Leased Small Box

Lowe’s reports that about 89% of its retail stores are owned, including stores on leased land, with the remainder leased from third parties (fiscal 2025 Form 10-K). A Lowe’s listing can therefore be a ground lease, where the investor owns the land and the tenant owns the building, or a building lease. Tractor Supply reports the reverse profile: it leases about 97% of its stores, with store leases that typically have initial terms of 10 to 20 years and two to four optional five-year renewal periods exercisable at the company’s option (fiscal 2025 Form 10-K). The renewal options mean a lease can run past its initial term only if Tractor Supply chooses to renew.

Tractor Supply also states that it plans to continue using a sale-leaseback program on existing owned stores and on future new store openings, and it opened 99 new Tractor Supply stores in fiscal 2025 (Form 10-K). Whatever the origin of a listing, confirm the remaining term, rent schedule and expense responsibilities in the executed lease, and compare each listing only with the same structure.

The Box: Size and Re-Use

A Lowe’s store averages approximately 112,000 square feet of selling space plus approximately 32,000 square feet of outdoor garden center, while Tractor Supply states that its stores typically range from 15,000 to 20,000 square feet of inside selling space, plus outside selling space (fiscal 2025 Form 10-K for each company). A large box can have a narrower pool of replacement tenants if the original tenant leaves, and a store in the Tractor Supply size range may be easier to subdivide or re-let, but neither is certain, so remaining term, renewal options and the tenant’s commitment to the location carry weight in the underwriting.

Tractor Supply also reports that about 61% of its stores are in freestanding buildings and 39% are in shopping centers (fiscal 2025 Form 10-K), so check co-tenancy and go-dark provisions for shopping center locations, and confirm land area, parking and access for each site.

Cap Rates: Live Medians for Home and Rural Retail Peers

Live asking cap rates for Lowe’s, Tractor Supply and comparable tenants:

Active listings InvestmentGrade.com tracks with an asking cap rate (stated in the listing, or computed from its stated income and price when no rate is stated), listings last observed October 26, 2026. Asking cap rates are not closed-sale cap rates. The middle half is the range from the 25th to the 75th percentile of listings. The 10-year Treasury yield is 4.99% as of October 27, 2026 (FRED series DGS10). Ratings are the agency ratings in our ratings database for the entity shown, which may be a parent company; the rating type (for example issuer, senior unsecured debt, long-term debt or revenue bond ratings) varies by company and is shown on each tenant page. A rating applies to a lease only if the rated entity signs or guarantees it, so confirm the tenant and any guarantor in the lease. n/a means no verified rating is on file.

Across the active listings we track, Lowe’s asks a live median cap rate of 5.63%, while Tractor Supply asks 6.10%. Each median rests on the listing count shown in the table, and with few listings a single property can move a median, so treat the numbers as a snapshot of what sellers are asking rather than a measure of what buyers pay.

The Bond-to-NNN Pivot

Income buyers can compare real estate against a bond benchmark. A corporate bond index for the matching rating category is one such benchmark, but it is a category measure rather than a quote on a Lowe’s or Tractor Supply bond, so the pre-tax comparison depends on where corporate yields stand when you buy. The cap rate table above shows each tenant’s median asking cap rate against the 10-year Treasury yield, and current index yields by rating category are on our corporate bond yields by rating page.

The case for owning the real estate rather than a bond rests on 1031 exchange eligibility, residual land value, scheduled rent increases where the lease has them, and building depreciation when the investor owns the building (see Internal Revenue Code Section 1031 and IRS Publication 946). The company-level math is in Lowe’s Bonds vs NNN Real Estate and Tractor Supply Bonds vs NNN Real Estate. Tax outcomes depend on your situation; this is general information, not tax advice.

Verdict: Which Tenant Wins?

On the ratings in our database, Lowe’s (BBB+/Baa1) is one notch above Tractor Supply (BBB/Baa1) at S&P and level with it at Moody’s as of the check date, so the credit gap is narrow. The live medians show where sellers are asking for each, and the table lists the listing counts behind them; Tractor Supply has far more listings in our data than Lowe’s, so its median rests on a larger sample.

Neither answer replaces property-level diligence. The deciding factors are the lease obligor, remaining term, renewal options, ground lease versus building lease, the size of the box and the location, not the logo. If you are weighing a replacement property under a 1031 exchange deadline, compare listings with the same lease structure and confirm the tenant and any guaranty in the executed lease.