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Toll Brothers
(NYSE:TOL)
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Rating:74Outperform
Price Target:
$147.00
▼(-2.54% Downside)
Action:Reiterated
Date:08/29/26
The score is driven primarily by strong underlying financial quality (healthy margins, improved leverage, and solid free cash flow) and a supportive valuation (low P/E). The latest earnings call was broadly positive with guidance maintained/tightened and increased buybacks, but near-term technicals are weaker with negative momentum and the stock trading below key short-term moving averages.
Positive Factors
Conservative balance sheet
Material deleveraging and low net debt improve Toll Brothers’ ability to withstand housing-cycle volatility while preserving capacity for land investment and operations. Growing equity and approximately $3.3 billion of liquidity further support financial flexibility through changing demand conditions.
Negative Factors
Revenue and margin normalization
The decline from 2024 peak profitability shows that earnings power is sensitive to the current housing cycle and has not remained fully stable. Lower revenue and compressed margins can reduce internally generated capital for land growth and make future results more dependent on pricing and cost control.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet
Material deleveraging and low net debt improve Toll Brothers’ ability to withstand housing-cycle volatility while preserving capacity for land investment and operations. Growing equity and approximately $3.3 billion of liquidity further support financial flexibility through changing demand conditions.
Read all positive factors
Toll Brothers (TOL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.49B
Dividend Yield0.76%
Average Volume (3M)1.14M
Price to Earnings (P/E)10.8
Beta (1Y)0.90
Revenue Growth-1.08%
EPS Growth-8.57%
CountryUS
Employees4,900
SectorConsumer Cyclical
Sector Strength84
IndustryResidential Construction
Share Statistics
EPS (TTM)12.54
Shares Outstanding92,147,000
10 Day Avg. Volume1,005,122
30 Day Avg. Volume1,140,366
Financial Highlights & Ratios
PEG Ratio-0.96
Price to Book (P/B)1.61
Price to Sales (P/S)1.22
P/FCF Ratio13.02
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue1.45
Enterprise Value/Gross Profit6.00
Enterprise Value/Ebitda9.39
Forecast
1Y Price Target
$168.64Price Target Upside11.81% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
EPS Forecast (FY)12.72
Revenue Forecast (FY)$10.80B
Toll Brothers Business Overview & Revenue Model
Company Description
Toll Brothers, Inc. (TOL) stands as a prominent luxury homebuilder operating across the United States. The company, along with its various divisions, specializes in the design, construction, marketing, sale, and financing of upscale detached and a...
How the Company Makes Money
Toll Brothers primarily makes money by selling newly constructed homes and related residential products to homebuyers. The company’s core revenue stream is home sales revenue, which is recognized when a home is delivered/closed, and is driven by t...
Toll Brothers Earnings Call Summary
Earnings Call Date:Aug 18, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Dec 14, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive tone: the company beat both revenue and earnings guidance, improved margins modestly versus guidance, increased share repurchases, grew selling communities and maintained a strong balance sheet with lower leverage and strong liquidity. Management acknowledged persistent macro headwinds — elevated mortgage rates, muted consumer confidence, regional softness and some input-cost pressure — but emphasized disciplined pricing, a resilient luxury move-up customer base, reduced finished spec inventory, and operational efficiency. Given the scale and significance of the beats, upgraded guidance items, capital return increase and balance sheet improvements relative to the manageable set of operational and market challenges, the overall message was optimistic about the company’s positioning and ability to deliver through a tough market and outperform when conditions improve.Positive Updates
Strong Quarterly Deliveries and Revenue
Delivered 2,662 homes and generated $2.65 billion of home sales revenue in Q3, beating the midpoint of guidance on both units and dollars.
Negative Updates
Subdued Demand and Macro Headwinds
Management described the overall sales environment as subdued due to low consumer confidence and elevated mortgage rates; early fourth-quarter (first 2–2.5 weeks) demand remained challenging.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Quarterly Deliveries and Revenue
Delivered 2,662 homes and generated $2.65 billion of home sales revenue in Q3, beating the midpoint of guidance on both units and dollars.
Read all positive updates
Company Guidance
Toll Brothers reaffirmed and tightened guidance for fiscal 2026, forecasting Q4 deliveries of 3,450–3,550 homes with an average delivered price of $995,000–$1.005 million and a Q4 adjusted gross margin of ~26.0%; for the full year they now expect 10,500–10,600 settlements, average delivered price $995,000–$1.0 million (a midpoint lift that adds roughly $53 million of revenue), home sales revenue of ~ $10.5 billion, a full‑year adjusted gross margin of 26.1%, SG&A of ~10.1% (Q4 SG&A ~8.1%), interest and cost of sales of ~1.1%, other/unconsolidated/land income of ~$30 million in Q4 and ~$120 million for the year, a full‑year tax rate of ~25.2% (Q4 ~26.0%), weighted average share count of ~94 million in Q4/~95 million for the year, increased share repurchases to $700 million (up from $650 million; $433 million completed through Q3), expected year‑end community count of 480–490 (8%–10% growth vs FY25), and continued strong liquidity (~$3.3 billion) and low leverage (net debt‑to‑capital ~15.6%).Toll Brothers Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
82
Very Positive
Cash Flow
74
Positive
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 10.76B | 10.97B | 10.85B | 9.99B | 10.28B | 8.79B |
| Gross Profit | 2.61B | 2.85B | 3.02B | 2.63B | 2.49B | 1.94B |
| EBITDA | 1.67B | 1.87B | 2.17B | 1.92B | 1.78B | 1.18B |
| Net Income | 1.20B | 1.35B | 1.57B | 1.37B | 1.29B | 833.63M |
Balance Sheet | ||||||
| Total Assets | 14.69B | 14.52B | 13.37B | 12.53B | 12.29B | 11.54B |
| Cash, Cash Equivalents and Short-Term Investments | 1.06B | 1.26B | 1.30B | 1.30B | 1.35B | 1.64B |
| Total Debt | 2.91B | 2.92B | 2.96B | 2.98B | 3.47B | 3.80B |
| Total Liabilities | 6.14B | 6.23B | 5.68B | 5.71B | 6.27B | 6.20B |
| Stockholders Equity | 8.53B | 8.27B | 7.67B | 6.80B | 6.01B | 5.30B |
Cash Flow | ||||||
| Free Cash Flow | 1.09B | 1.03B | 936.52M | 1.19B | 915.09M | 1.24B |
| Operating Cash Flow | 1.19B | 1.11B | 1.01B | 1.27B | 986.82M | 1.30B |
| Investing Cash Flow | 46.45M | -310.03M | -167.62M | -150.60M | -153.18M | -4.24M |
| Financing Cash Flow | -1.05B | -833.88M | -816.46M | -1.17B | -1.12B | -1.01B |
Toll Brothers Technical Analysis
Positive
150.83
Price Trends
138.23
Positive
144.20
Negative
143.60
Negative
Market Momentum
-0.59
Negative
59.76
Neutral
86.53
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOL, the sentiment is Positive. The current price of 150.83 is above the 20-day moving average (MA) of 134.78, above the 50-day MA of 138.23, and above the 200-day MA of 143.60, indicating a neutral trend. The MACD of -0.59 indicates Negative momentum. The RSI at 59.76 is Neutral, neither overbought nor oversold. The STOCH value of 86.53 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TOL.
Toll Brothers Risk Analysis
Toll Brothers disclosed 29 risk factors in its most recent earnings report. Toll Brothers reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Toll Brothers Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $12.49B | 10.77 | 14.23% | 0.76% | -1.08% | -8.57% | |
72 Outperform | $15.93B | 14.52 | 29.53% | ― | -9.66% | -19.36% | |
70 Outperform | $21.47B | 11.48 | 13.80% | 0.92% | -7.28% | -26.86% | |
69 Neutral | $38.87B | 13.20 | 12.77% | 1.30% | -3.54% | -15.86% | |
63 Neutral | $2.88B | 10.61 | 8.64% | ― | -5.91% | -38.43% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $18.47B | 14.69 | 6.03% | 2.57% | -8.01% | -47.77% |
* Consumer Cyclical Sector Average
TOL
Toll Brothers
141.08
5.39
3.97%
DHI
DR Horton
147.66
-9.01
-5.75%
LEN
Lennar
84.45
-40.10
-32.19%
MHO
M/I Homes
123.30
-8.90
-6.73%
NVR
NVR
6,110.63
-1,568.78
-20.43%
PHM
PulteGroup
119.48
-0.36
-0.30%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.