Investors should take notice of NYSE:TOL—it offers a great deal for the fundamentals it presents.

Our stock screener has singled out TOLL BROTHERS INC (NYSE:TOL) as a stellar value proposition. NYSE:TOL not only scores well in profitability, solvency, and liquidity but also maintains a very reasonable price point. We'll explore this further.

A Closer Look at Valuation for NYSE:TOL

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:TOL has received a 9 out of 10:

• TOL is valuated cheaply with a Price/Earnings ratio of 6.57.
• 88.06% of the companies in the same industry are more expensive than TOL, based on the Price/Earnings ratio.
• When comparing the Price/Earnings ratio of TOL to the average of the S&P500 Index (24.54), we can say TOL is valued rather cheaply.
• Based on the Price/Forward Earnings ratio of 7.25, the valuation of TOL can be described as very cheap.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of TOL indicates a somewhat cheap valuation: TOL is cheaper than 77.61% of the companies listed in the same industry.
• TOL's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 19.58.
• TOL's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TOL is cheaper than 79.10% of the companies in the same industry.
• 80.60% of the companies in the same industry are more expensive than TOL, based on the Price/Free Cash Flow ratio.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• TOL has an outstanding profitability rating, which may justify a higher PE ratio.

How do we evaluate the Profitability for NYSE:TOL?

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:TOL, the assigned 8 is noteworthy for profitability:

• With an excellent Return On Assets value of 12.69%, TOL belongs to the best of the industry, outperforming 83.58% of the companies in the same industry.
• The Return On Equity of TOL (23.41%) is better than 88.06% of its industry peers.
• The Return On Invested Capital of TOL (14.64%) is better than 83.58% of its industry peers.
• The 3 year average ROIC (8.48%) for TOL is below the current ROIC(14.64%), indicating increased profibility in the last year.
• TOL's Profit Margin of 14.66% is amongst the best of the industry. TOL outperforms 89.55% of its industry peers.
• TOL's Profit Margin has improved in the last couple of years.
• The Operating Margin of TOL (17.37%) is better than 91.04% of its industry peers.
• In the last couple of years the Operating Margin of TOL has grown nicely.
• TOL's Gross Margin has improved in the last couple of years.

Looking at the Health

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:TOL has achieved a 8 out of 10:

• An Altman-Z score of 3.90 indicates that TOL is not in any danger for bankruptcy at the moment.
• The Altman-Z score of TOL (3.90) is better than 67.16% of its industry peers.
• The Debt to FCF ratio of TOL is 1.54, which is an excellent value as it means it would take TOL, only 1.54 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of TOL (1.54) is better than 62.69% of its industry peers.
• TOL has a Debt/Equity ratio of 0.42. This is a healthy value indicating a solid balance between debt and equity.
• A Current Ratio of 3.85 indicates that TOL has no problem at all paying its short term obligations.
• Looking at the Current ratio, with a value of 3.85, TOL is in the better half of the industry, outperforming 67.16% of the companies in the same industry.
• The current and quick ratio evaluation for TOL is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Growth Assessment of NYSE:TOL

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NYSE:TOL has earned a 5 for growth:

• The Earnings Per Share has grown by an impressive 53.43% over the past year.
• TOL shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.41% yearly.
• The Revenue has grown by 11.27% in the past year. This is quite good.
• Measured over the past years, TOL shows a quite strong growth in Revenue. The Revenue has been growing by 12.06% on average per year.

More Decent Value stocks can be found in our Decent Value screener.

Our latest full fundamental report of TOL contains the most current fundamental analsysis.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.