Toll Brothers (TOL) closed the latest trading day at $136.68, indicating a +0.35% change from the previous session's end. This change lagged the S&P 500's 0.53% gain on the day. Meanwhile, the Dow gained 0.93%, and the Nasdaq, a tech-heavy index, added 0.22%.
Heading into today, shares of the home builder had gained 6.51% over the past month, outpacing the Construction sector's gain of 4.6% and the S&P 500's gain of 2.69% in that time.
Market participants will be closely following the financial results of Toll Brothers in its upcoming release. It is anticipated that the company will report an EPS of $1.99, marking a 11.56% fall compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $1.9 billion, indicating a 2.56% decline compared to the corresponding quarter of the prior year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $14.25 per share and a revenue of $10.99 billion, representing changes of -5.06% and +1.29%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Toll Brothers. These revisions typically reflect the latest short-term business trends, which can change frequently. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Currently, Toll Brothers is carrying a Zacks Rank of #3 (Hold).
With respect to valuation, Toll Brothers is currently being traded at a Forward P/E ratio of 9.56. Its industry sports an average Forward P/E of 8.36, so one might conclude that Toll Brothers is trading at a premium comparatively.
Meanwhile, TOL's PEG ratio is currently 1.04. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Building Products - Home Builders was holding an average PEG ratio of 0.85 at yesterday's closing price.
The Building Products - Home Builders industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 220, finds itself in the bottom 13% echelons of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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