JPMorgan upgraded Toll Brothers (TOL) to Overweight from Neutral with a price target of $161, up from $138. The firm maintains a cautious stance on the homebuilders sector for 2026. JPMorgan expects an unfavorable demand/supply backdrop to bring additional pressure and downside risk for builder fundamentals. Builder fundamentals are likely to remain “relatively weak” in 2026, with persisting downside risk to estimates due to a still challenged demand/supply industry backdrop, the analyst tells investors in a research note. JPMorgan views Toll’s valuation as attractive given the company’s “solidly above average” gross and operating margins.
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