- Deliveries Forecast Shortfall: Toll Brothers projects 2,500 to 2,700 home deliveries, which is below the estimated 2,781.
- Home Sales Margin Forecast: The adjusted home sales gross margin is expected to be 27.3%, slightly above the estimated 27%.
- SG&A Expenses Forecast: Selling, General & Administrative expenses are projected at 10.3% of home sales revenue, exceeding the estimated 9.11%.
- End Community Count Forecast: Predicted end community count is 415, which is slightly below the estimated 421.27.
- First Quarter EPS Decline: Earnings per share declined to $1.75, down from $2.25 year-over-year.
- Revenue Decrease: Revenue fell 4.6% year-over-year to $1.86 billion, missing the $1.92 billion estimate.
- Increase in Net Signed Contracts: There was a 13% year-over-year increase in net signed contracts to 2,307 units, though below the estimate of 2,441 units.
- End Community Count Growth: The end community count increased by 7.7% year-over-year to 406, slightly below the estimated 411.72.
- Growth in Total Home Sales: Total home sales rose by 3.3% year-over-year to 1,991, under the estimate of 2,037.
- Backlog Comparison: The backlog amounted to 6,312, slightly less than the estimate of 6,418, valued at $6.94 billion, a 2% decrease year-over-year.
- Adjusted Home Sales Margin: Adjusted home sales gross margin was at 26.9%, down from 28.9% year-over-year, above the estimated 26.1%.
- Increased SG&A Expenses: SG&A expenses were 13.1% of home sales revenue, an increase from 11.9% year-over-year, exceeding the estimated 12.5%.
- Market Outlook: The company remains optimistic about the long-term prospects of the new home market, citing strong fundamentals.
- Analyst Recommendations: There are 11 buy, 8 hold, and 1 sell recommendations from analysts.
Toll Brothers on Smartkarma
In recent analyst coverage on Smartkarma, Baptista Research has provided bullish insights on Toll Brothers, a prominent luxury homebuilder. In one report titled “Toll Brothers: Community Growth & Product Diversification Fueling Our ‘Buy’ Rating! – Major Drivers”, the analysts highlighted the company’s robust performance in the fourth quarter of fiscal 2024. Toll Brothers demonstrated resilience and adaptability amidst challenges, with a significant increase in home deliveries and sales revenues. The company delivered 3,431 homes, showing a 25% year-over-year increase in unit delivery and a 10% rise in revenue, totaling $3.3 billion.
Another report by Baptista Research, “Toll Brothers: Expanding Geographic Footprint & Emphasis on Spec Homes Driving Growth! – Major Drivers”, showcased an optimistic third quarter for the 2024 fiscal year. Despite varied market conditions, Toll Brothers reported record home sale revenues of $2.72 billion, delivering 2,814 homes at an average price of $968,000. The adjusted gross margin outperformed projections at 28.8%, supported by operational efficiencies and a favorable mix of home sales. These reports reflect positive sentiment from analysts regarding Toll Brothers‘ performance and growth strategies.
A look at Toll Brothers Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 2 | |
| Growth | 4 | |
| Resilience | 3 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
According to Smartkarma’s Smart Scores, Toll Brothers, Inc. shows a positive long-term outlook. With a strong score of 4 for both value and growth, the company is positioned well for future success. The value score indicates that Toll Brothers is considered undervalued, offering potential for investors. Additionally, the growth score suggests that the company is expected to see positive growth in the long run.
While the dividend score is rated at 2, indicating a moderate outlook in terms of dividend payments, Toll Brothers scores a 3 for both resilience and momentum. This resilience score reflects the company’s ability to withstand economic downturns, while the momentum score indicates a positive trend in its stock performance. Combining these factors, Toll Brothers appears to be a solid investment choice for those looking for long-term growth in the luxury homes market.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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