Fact based stock research
Toll Brothers (NYSE:TOL)

US8894781033

How to read the free ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Toll Brothers stock research in summary

tollbrothers.com

ANALYSIS: With an Obermatt Combined Rank of 82 (better than 82% compared with investment alternatives), Toll Brothers (Homebuilding, USA) shares have much better financial characteristics than comparable stocks. Shares of Toll Brothers are a good value (attractively priced) with a consolidated Value Rank of 53 (better than 53% of alternatives), are safely financed (Safety Rank of 52, which means low debt burdens), but show below-average growth (Growth Rank of 33). ...read more

RECOMMENDATION: A Combined Rank of 82, is a strong buy recommendation based on Toll Brothers's financial characteristics. As the company Toll Brothers's key financial metrics exhibit good value (Obermatt Value Rank of 53) but low growth (Obermatt Growth Rank of 33) while being safely financed (Obermatt Safety Rank of 52), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 53% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	53
Growth Rank	33
Safety Rank	52
Combined Rank	82

Country	USA
Industry	Homebuilding
Index	Dividends USA, Employee Focus US, S&P MIDCAP
Size class	X-Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Toll Brothers

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	71	93	75	53
GROWTH
GROWTH	87	79	73	33
SAFETY
SAFETY	50	52	52	52
SENTIMENT
SENTIMENT	n/a	53	97	^new
360° VIEW
360° VIEW	n/a	93	57	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 31-Jul-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Toll Brothers is in the corresponding investment strategy.
Upgrade to a Premium Account to access the latest ranks.

Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	71	93	75	53
GROWTH
GROWTH	87	79	73	33
SAFETY
SAFETY	50	52	52	52
COMBINED
COMBINED	80	82	82	82

Last update of combined financial performance: 10-Nov-2022. Stock analysis on combined financial performance: The higher the rank of Toll Brothers the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 53 (better than 53% compared with alternatives), Toll Brothers shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Toll Brothers. Price-to-Profit (also referred to as price-earnings, P/E) is 61 which means that the stock price compared with what market professionals expect for future profits is lower than for 61% of comparable companies, indicating a good value concerning Toll Brothers's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 45, which means that the stock price is lower as regards to invested capital than for 45% of comparable investments. On the other hand, Price-to-Sales is less favorable than 68% of alternatives (only 32% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 39% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a buy recommendation based on Toll Brothers's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	67	71	40	32
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	71	67	83	61
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	59	87	55	45
DIVIDEND YIELD
DIVIDEND YIELD	45	75	66	61
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	71	93	75	53

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Toll Brothers; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 33 (better than 33% compared with alternatives), Toll Brothers shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Toll Brothers. Profit Growth has a rank of 60, which means that currently professionals expect the company to grow its profits more than 60% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 95 (above 95% of alternative investments). But Sales Growth has a below the median rank of 26, which means that, currently, professionals expect the company to grow less than 74% of its competitors, and Capital Growth also has a lower rank of 12. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 33, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Toll Brothers. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	52	66	30	26
PROFIT GROWTH
PROFIT GROWTH	12	51	60	60
CAPITAL GROWTH
CAPITAL GROWTH	n/a	51	68	12
STOCK RETURNS
STOCK RETURNS	92	85	89	95
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	87	79	73	33

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Toll Brothers.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 52 (better than 52% compared with alternatives), the company Toll Brothers has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Toll Brothers is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for Toll Brothers. Leverage is at 54, meaning the company has a below-average debt-to-equity ratio. It has less debt than 54% of its competitors. Refinancing is at a rank of 85, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 85% of its competitors. Finally, Liquidity is also good at a rank of 64, which means that the company generates more profit to service its debt than 64% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 52 (better than 52% compared with alternatives), Toll Brothers has a financing structure that is safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Toll Brothers but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	18	42	64	54
REFINANCING
REFINANCING	94	85	85	85
LIQUIDITY
LIQUIDITY	46	49	68	64
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	50	52	52	52

Last update of Safety Rank: 10-Nov-2022. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Toll Brothers and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	14	65	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	45	93	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	89	79	^new
MARKET PULSE
MARKET PULSE	n/a	48	56	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	53	97	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Toll Brothers.
Upgrade to a Premium Account to access the latest ranks.