On Monday night, retailer Tractor Supply (NASDAQ:TSCO) -- which serves the maintenance and business needs of rural residents and businesses -- reported Q3 and nine-month financial results that were in line with past company guidance, came in barely ahead of Street estimates, and reflected continued strength in the company's growing business. All in all, Tractor Supply's business is looking pretty solid these days.

The company, which competes (depending on the market segment) with Wal-Mart (NYSE:WMT), Home Depot (NYSE:HD), Sears (NYSE:S), and others, said nine-month net sales rose more than 18% to $1.28 billion as the company has both grown its footprint -- it now has more than 500 stores -- and seen same-store sales improve an impressive nearly 11%. Gross and operating margins have come under pressure for a number of reasons, but the top-line strength was enough to drive net profit growth.

Investors following Tractor Supply's chart will notice that the shares are well off their 52-week highs (set back in January), not to mention recent levels around $40 per share set about a month ago. In fact, Tractor Supply has underperformed the S&P 500 over the last 12 months, though its longer-term trend is pretty darn impressive. Still, it's not difficult to see how all that fresh-cut grass smell might have gone to investors' heads.

Assume the company hits the high end of its latest full-year guidance and turns in full-year net income of $64.4 million, which would represent roughly 10% year-over-year net income growth. At $40 per share, the market was asking nearly 26 times next year's optimistic estimate for a share in the company -- certainly a rich valuation for a company that still needs to grow and improve operations in order to become a steady long-term cash flow provider.

Put simply, Tractor Supply -- even with its recent dip -- still has a way to fall before it looks like a value.

Fool contributor Dave Marino-Nachison doesn't own any of the companies in this story.