Rafe Jadrosich, an analyst from Bank of America Securities, reiterated the Buy rating on Toll Brothers. The associated price target remains the same with $150.00.
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Rafe Jadrosich has given his Buy rating due to a combination of factors that highlight Toll Brothers’ potential for growth and attractive valuation. Despite a miss in the fourth quarter earnings due to a delay in the Apartment Living sale, the transaction is expected to be completed soon, which could enhance the company’s return on equity. The valuation of Toll Brothers remains appealing when compared to other builders with similar ROE profiles, as it trades at a lower price-to-book multiple.
Additionally, the company’s fourth-quarter orders exceeded expectations, showing resilience in a soft market. The guidance for 2026 deliveries appears achievable, supported by a strong backlog and anticipated sales. Although there are some concerns regarding higher SG&A expenses and a conservative gross margin outlook, the company’s ability to manage costs and maintain steady incentives provides a positive outlook. Overall, the combination of these factors supports the Buy rating with a price objective of $150.
Jadrosich covers the Consumer Cyclical sector, focusing on stocks such as KB Home, NVR, and Somnigroup International. According to TipRanks, Jadrosich has an average return of 8.5% and a 55.28% success rate on recommended stocks.
In another report released yesterday, UBS also reiterated a Buy rating on the stock with a $181.00 price target.