Toll Brothers (TOL) AI Stock Analysis

• Market Cap: $10.65B
• Dividend Yield: 0.92%
• Average Volume (3M): 1.65M
• Price to Earnings (P/E): 8.0
• Beta (1Y): 1.22
• Revenue Growth: 1.59%
• EPS Growth: -8.04%
• Country: US
• Employees: 4,900
• Sector: Consumer Cyclical
• Sector Strength: 56
• Industry: Residential Construction
• EPS (TTM): 3.50
• Shares Outstanding: 98,181,000
• 10 Day Avg. Volume: 1,513,567
• 30 Day Avg. Volume: 1,646,320
• PEG Ratio: 0.06
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.50
• Enterprise Value/Market Cap: 0.79
• Enterprise Value/Revenue: 0.20
• Enterprise Value/Gross Profit: 3.05
• Enterprise Value/Ebitda: 1.05
• 1Y Price Target: $135.09
• Price Target Upside: 28.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 71 Outperform
• Price Target: $116.00 ▲(10.00%Upside)

Toll Brothers' score is driven by its strong financial performance, particularly in profitability and efficient operations, which are tempered by technical indicators showing caution. While valuation suggests potential upside, the earnings call and recent corporate events provide a balanced view of opportunities and challenges.

Positive Factors

Earnings

Toll Brothers reported F2Q25 EPS of $3.50, well ahead of forecast and consensus.

Share Repurchase

Toll Brothers plans to use its generated $1 billion annual cash flow to repurchase shares, focusing on return on equity.

Negative Factors

Demand Environment

Weakening confidence is likely to be a headwind too, and shares are seen as fairly valued now with limited upside over the foreseeable future.

Orders

F2Q orders decreased by 13% year-over-year, indicating a challenging demand environment.

Toll Brothers Business Overview & Revenue Model

Company Description

Toll Brothers, Inc., together with its subsidiaries, designs, builds, markets, sells, and arranges finance for a range of detached and attached homes in luxury residential communities in the United States. The company operates in two segments, Traditional Home Building and City Living. It also designs, builds, markets, and sells condominiums through Toll Brothers City Living. In addition, the company develops, owns, and operates golf courses and country clubs; develops and sells land; and develops, operates, and rents apartments, as well as provides various interior fit-out options, such as flooring, wall tile, plumbing, cabinets, fixtures, appliances, lighting, and home-automation and security technologies. Further, it owns and operates architectural, engineering, mortgage, title, insurance, smart home technology, landscaping, lumber distribution, house component assembly, and manufacturing operations. The company serves move-up, empty-nester, active-adult, and second-home buyers. It has a strategic partnership with Equity Residential to develop new rental apartment communities in the United States markets. The company was founded in 1967 and is headquartered in Fort Washington, Pennsylvania.

How the Company Makes Money

Toll Brothers generates revenue primarily through the sale of luxury homes. The company acquires and develops land, designs home models, and manages the construction process to deliver customized homes to its clients. Key revenue streams include home sales, as well as the sale of land and lots. Toll Brothers also offers related financial services, such as mortgage financing through its subsidiary, TBI Mortgage Company, which provides an additional revenue stream. Strategic partnerships with suppliers and contractors help optimize construction costs and contribute to the company's profitability. The company's earnings are influenced by factors such as housing market conditions, interest rates, and consumer confidence in the luxury home market.

Toll Brothers Financial Statement Overview

Summary

Toll Brothers shows strong profitability with high margins and robust cash flow management. The balance sheet is stable, with manageable leverage, although slight debt increases warrant monitoring.

Income Statement

Toll Brothers demonstrates strong profitability with a consistently high gross profit margin and net profit margin. The TTM gross profit margin is 25.8%, and the net profit margin is 12.9%, indicating efficient cost management. Revenue growth has been steady, though slightly fluctuating, with a recent TTM decrease of 1.7% compared to the previous year. Despite this, the company maintains robust EBIT and EBITDA margins at 16.7% and 17.2% respectively, reflecting good operational efficiency.

Balance Sheet

The balance sheet reflects a solid equity base with an equity ratio of 56.0% in the TTM period, suggesting financial stability. The debt-to-equity ratio is 0.37, indicating manageable leverage. ROE is strong at 17.4%, highlighting effective use of equity to generate profits. However, a slight increase in debt levels compared to the prior year could pose a potential risk if not managed carefully.

Cash Flow

Toll Brothers exhibits strong cash flow management with a TTM free cash flow of $723 million. Although free cash flow decreased compared to the previous period, the free cash flow to net income ratio remains healthy at 0.52, indicating a good conversion of profits into cash. The operating cash flow to net income ratio is 0.58, showing consistent cash generation ability, albeit with some fluctuations in growth rates.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.66B	10.85B	9.99B	10.28B	8.79B	7.08B
	Gross Profit
2.75B	3.02B	2.63B	2.49B	1.94B	1.42B
	EBIT
1.78B	2.04B	1.72B	1.51B	1.02B	550.26M
	EBITDA
1.84B	2.12B	1.80B	1.59B	1.10B	676.51M
	Net Income Common Stockholders
1.38B	1.57B	1.37B	1.29B	833.63M	446.62M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
686.47M	1.30B	1.30B	1.35B	1.64B	1.37B
	Total Assets
14.20B	13.37B	12.53B	12.29B	11.54B	11.07B
	Total Debt
2.93B	2.96B	2.98B	3.33B	3.56B	3.96B
	Net Debt
2.24B	1.66B	1.68B	1.98B	1.92B	2.59B
	Total Liabilities
6.23B	5.68B	5.71B	6.27B	6.20B	6.14B
	Stockholders Equity
7.95B	7.67B	6.80B	6.01B	5.30B	4.88B
Cash Flow		Free Cash Flow
723.34M	936.52M	1.19B	915.09M	1.24B	898.55M
	Operating Cash Flow
800.19M	1.01B	1.27B	986.82M	1.30B	1.01B
	Investing Cash Flow
-254.69M	-167.62M	-150.60M	-153.18M	-4.24M	-177.84M
	Financing Cash Flow
-871.28M	-816.62M	-1.17B	-1.12B	-1.01B	-753.31M

Toll Brothers Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 105.45
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOL, the sentiment is Negative. The current price of 105.45 is below the 20-day moving average (MA) of 106.73, above the 50-day MA of 102.79, and below the 200-day MA of 126.77, indicating a neutral trend. The MACD of 0.89 indicates Positive momentum. The RSI at 48.10 is Neutral, neither overbought nor oversold. The STOCH value of 19.31 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TOL.

Toll Brothers Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PHM	75 Outperform	$20.53B	7.23	25.52%	0.86%	8.86%	13.60%
TMHC	75 Outperform	$5.88B	6.65	15.97%	―	12.19%	23.15%
NVR	74 Outperform	$20.45B	14.36	38.25%	―	8.81%	1.79%
LEN	73 Outperform	$28.73B	9.05	13.06%	1.83%	-1.20%	-17.61%
TOL	71 Outperform	$10.65B	8.05	18.09%	0.92%	1.59%	-8.04%
DHI	68 Neutral	$36.84B	9.07	17.83%	1.33%	-4.71%	-10.19%
Sector *	62 Neutral	$6.79B	11.04	2.78%	4.43%	2.66%	-24.98%

Toll Brothers Corporate Events

Toll Brothers Announces Redemption of Senior Notes

On June 13, 2025, Toll Brothers Finance Corp., a subsidiary of Toll Brothers, Inc., announced its plan to redeem all $350 million of its outstanding 4.875% Senior Notes due 2025. The redemption, scheduled for July 15, 2025, will be executed at a price of either 100% of the principal amount or the present value of the remaining payments, whichever is greater, impacting the company’s financial strategy and potentially influencing its market positioning.

The most recent analyst rating on (TOL) stock is a Hold with a $125.00 price target. To see the full list of analyst forecasts on Toll Brothers stock, see the TOL Stock Forecast page.

Toll Brothers Completes $500M Senior Notes Offering

On June 10, 2025, Toll Brothers Finance Corp., a subsidiary of Toll Brothers, Inc., completed a public offering of $500 million in 5.600% Senior Notes due 2035. This move, underwritten by several financial institutions, aims to support general corporate purposes, including refinancing existing debt. The Senior Notes are unsecured and unsubordinated, with interest payable semi-annually, and are subject to certain covenants and redemption conditions. This financial maneuver is expected to bolster the company’s liquidity and financial flexibility, potentially impacting its market positioning and stakeholder interests.

The most recent analyst rating on (TOL) stock is a Hold with a $125.00 price target. To see the full list of analyst forecasts on Toll Brothers stock, see the TOL Stock Forecast page.