TOLL BROTHERS INC (TOL)

US8894781033 - Common Stock

126.45  -1.78 (-1.39%)

After market: 126 -0.45 (-0.36%)

Fundamental Rating

7

Overall TOL gets a fundamental rating of 7 out of 10. We evaluated TOL against 66 industry peers in the Household Durables industry. While TOL belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. TOL is not valued too expensively and it also shows a decent growth rate.



8

1. Profitability

1.1 Basic Checks

TOL had positive earnings in the past year.
In the past year TOL had a positive cash flow from operations.
In the past 5 years TOL has always been profitable.
TOL had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

TOL has a better Return On Assets (11.75%) than 85.94% of its industry peers.
With an excellent Return On Equity value of 20.48%, TOL belongs to the best of the industry, outperforming 82.81% of the companies in the same industry.
TOL has a Return On Invested Capital of 14.49%. This is in the better half of the industry: TOL outperforms 79.69% of its industry peers.
The Average Return On Invested Capital over the past 3 years for TOL is in line with the industry average of 12.02%.
The 3 year average ROIC (13.26%) for TOL is below the current ROIC(14.49%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 11.75%
ROE 20.48%
ROIC 14.49%
ROA(3y)11.06%
ROA(5y)8.89%
ROE(3y)20.7%
ROE(5y)17.4%
ROIC(3y)13.26%
ROIC(5y)10.59%

1.3 Margins

TOL has a better Profit Margin (14.49%) than 90.63% of its industry peers.
TOL's Profit Margin has improved in the last couple of years.
TOL has a Operating Margin of 18.85%. This is amongst the best in the industry. TOL outperforms 90.63% of its industry peers.
TOL's Operating Margin has improved in the last couple of years.
TOL has a Gross Margin (27.91%) which is in line with its industry peers.
In the last couple of years the Gross Margin of TOL has grown nicely.
Industry RankSector Rank
OM 18.85%
PM (TTM) 14.49%
GM 27.91%
OM growth 3Y17.51%
OM growth 5Y14.86%
PM growth 3Y15.15%
PM growth 5Y12.14%
GM growth 3Y8.08%
GM growth 5Y7.34%

6

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TOL is still creating some value.
Compared to 1 year ago, TOL has less shares outstanding
TOL has less shares outstanding than it did 5 years ago.
TOL has a better debt/assets ratio than last year.

2.2 Solvency

TOL has an Altman-Z score of 4.26. This indicates that TOL is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.26, TOL is doing good in the industry, outperforming 64.06% of the companies in the same industry.
TOL has a debt to FCF ratio of 3.02. This is a good value and a sign of high solvency as TOL would need 3.02 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.02, TOL is doing good in the industry, outperforming 67.19% of the companies in the same industry.
A Debt/Equity ratio of 0.37 indicates that TOL is not too dependend on debt financing.
TOL has a Debt to Equity ratio (0.37) which is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.37
Debt/FCF 3.02
Altman-Z 4.26
ROIC/WACC1.67
WACC8.67%

2.3 Liquidity

TOL has a Current Ratio of 4.05. This indicates that TOL is financially healthy and has no problem in meeting its short term obligations.
TOL has a better Current ratio (4.05) than 70.31% of its industry peers.
TOL has a Quick Ratio of 4.05. This is a bad value and indicates that TOL is not financially healthy enough and could expect problems in meeting its short term obligations.
TOL has a Quick ratio of 0.58. This is in the lower half of the industry: TOL underperforms 75.00% of its industry peers.
Industry RankSector Rank
Current Ratio 4.05
Quick Ratio 0.58

6

3. Growth

3.1 Past

TOL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.86%, which is quite good.
The Earnings Per Share has been growing by 27.96% on average over the past years. This is a very strong growth
TOL shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.52%.
Measured over the past years, TOL shows a quite strong growth in Revenue. The Revenue has been growing by 8.47% on average per year.
EPS 1Y (TTM)11.86%
EPS 3Y27.67%
EPS 5Y27.96%
EPS Q2Q%12.65%
Revenue 1Y (TTM)8.52%
Revenue growth 3Y7.26%
Revenue growth 5Y8.47%
Sales Q2Q%12.93%

3.2 Future

TOL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.04% yearly.
The Revenue is expected to grow by 7.97% on average over the next years.
EPS Next Y4.76%
EPS Next 2Y6.92%
EPS Next 3Y7.62%
EPS Next 5Y9.04%
Revenue Next Year3.58%
Revenue Next 2Y5.1%
Revenue Next 3Y3.43%
Revenue Next 5Y7.97%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.

6

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 9.12, which indicates a very decent valuation of TOL.
Compared to the rest of the industry, the Price/Earnings ratio of TOL indicates a somewhat cheap valuation: TOL is cheaper than 70.31% of the companies listed in the same industry.
TOL is valuated cheaply when we compare the Price/Earnings ratio to 27.35, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 8.71, the valuation of TOL can be described as reasonable.
70.31% of the companies in the same industry are more expensive than TOL, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 23.86. TOL is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 9.12
Fwd PE 8.71

4.2 Price Multiples

TOL's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TOL is cheaper than 76.56% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, TOL is valued a bit cheaper than 78.13% of the companies in the same industry.
Industry RankSector Rank
P/FCF 13.47
EV/EBITDA 6.66

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TOL does not grow enough to justify the current Price/Earnings ratio.
TOL has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.92
PEG (5Y)0.33
EPS Next 2Y6.92%
EPS Next 3Y7.62%

5

5. Dividend

5.1 Amount

TOL has a yearly dividend return of 0.72%, which is pretty low.
Compared to an average industry Dividend Yield of 2.94, TOL pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.30, TOL's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.72%

5.2 History

On average, the dividend of TOL grows each year by 15.67%, which is quite nice.
TOL has been paying a dividend for over 5 years, so it has already some track record.
TOL has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)15.67%
Div Incr Years4
Div Non Decr Years7

5.3 Sustainability

TOL pays out 5.94% of its income as dividend. This is a sustainable payout ratio.
The dividend of TOL is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP5.94%
EPS Next 2Y6.92%
EPS Next 3Y7.62%

TOLL BROTHERS INC

NYSE:TOL (12/27/2024, 8:04:00 PM)

After market: 126 -0.45 (-0.36%)

126.45

-1.78 (-1.39%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)12-09 2024-12-09/amc
Earnings (Next)02-18 2025-02-18/amc
Inst Owners90.96%
Inst Owner Change-0.72%
Ins Owners0.52%
Ins Owner Change-6.17%
Market Cap12.62B
Analysts78.26
Price Target163.46 (29.27%)
Short Float %2.51%
Short Ratio2.01
Dividend
Industry RankSector Rank
Dividend Yield 0.72%
Dividend Growth(5Y)15.67%
DP5.94%
Div Incr Years4
Div Non Decr Years7
Ex-Date01-10 2025-01-10 (0.23)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.6%
Min EPS beat(2)5.65%
Max EPS beat(2)7.56%
EPS beat(4)3
Avg EPS beat(4)4.77%
Min EPS beat(4)-19.17%
Max EPS beat(4)25.07%
EPS beat(8)7
Avg EPS beat(8)15.72%
EPS beat(12)11
Avg EPS beat(12)14.2%
EPS beat(16)15
Avg EPS beat(16)18.46%
Revenue beat(2)1
Avg Revenue beat(2)1.89%
Min Revenue beat(2)-0.37%
Max Revenue beat(2)4.14%
Revenue beat(4)3
Avg Revenue beat(4)2.52%
Min Revenue beat(4)-0.37%
Max Revenue beat(4)4.14%
Revenue beat(8)7
Avg Revenue beat(8)5.88%
Revenue beat(12)9
Avg Revenue beat(12)5.83%
Revenue beat(16)12
Avg Revenue beat(16)6.1%
PT rev (1m)-0.09%
PT rev (3m)3.66%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.92%
EPS NY rev (1m)-1.55%
EPS NY rev (3m)-1.76%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)3.09%
Revenue NY rev (1m)0.52%
Revenue NY rev (3m)0.31%
Valuation
Industry RankSector Rank
PE 9.12
Fwd PE 8.71
P/S 1.16
P/FCF 13.47
P/OCF 12.49
P/B 1.64
P/tB 1.64
EV/EBITDA 6.66
EPS(TTM)13.86
EY10.96%
EPS(NY)14.52
Fwd EY11.48%
FCF(TTM)9.38
FCFY7.42%
OCF(TTM)10.12
OCFY8.01%
SpS108.7
BVpS76.87
TBVpS76.87
PEG (NY)1.92
PEG (5Y)0.33
Profitability
Industry RankSector Rank
ROA 11.75%
ROE 20.48%
ROCE 19.34%
ROIC 14.49%
ROICexc 16.52%
ROICexgc 16.73%
OM 18.85%
PM (TTM) 14.49%
GM 27.91%
FCFM 8.63%
ROA(3y)11.06%
ROA(5y)8.89%
ROE(3y)20.7%
ROE(5y)17.4%
ROIC(3y)13.26%
ROIC(5y)10.59%
ROICexc(3y)15.3%
ROICexc(5y)12.36%
ROICexgc(3y)15.57%
ROICexgc(5y)12.57%
ROCE(3y)17.71%
ROCE(5y)14.14%
ROICexcg growth 3Y16.35%
ROICexcg growth 5Y20.45%
ROICexc growth 3Y16.42%
ROICexc growth 5Y20.38%
OM growth 3Y17.51%
OM growth 5Y14.86%
PM growth 3Y15.15%
PM growth 5Y12.14%
GM growth 3Y8.08%
GM growth 5Y7.34%
F-Score8
Asset Turnover0.81
Health
Industry RankSector Rank
Debt/Equity 0.37
Debt/FCF 3.02
Debt/EBITDA 1.33
Cap/Depr 90.69%
Cap/Sales 0.68%
Interest Coverage 250
Cash Conversion 47.52%
Profit Quality 59.61%
Current Ratio 4.05
Quick Ratio 0.58
Altman-Z 4.26
F-Score8
WACC8.67%
ROIC/WACC1.67
Cap/Depr(3y)93.15%
Cap/Depr(5y)105.24%
Cap/Sales(3y)0.7%
Cap/Sales(5y)0.88%
Profit Quality(3y)72.56%
Profit Quality(5y)113.39%
High Growth Momentum
Growth
EPS 1Y (TTM)11.86%
EPS 3Y27.67%
EPS 5Y27.96%
EPS Q2Q%12.65%
EPS Next Y4.76%
EPS Next 2Y6.92%
EPS Next 3Y7.62%
EPS Next 5Y9.04%
Revenue 1Y (TTM)8.52%
Revenue growth 3Y7.26%
Revenue growth 5Y8.47%
Sales Q2Q%12.93%
Revenue Next Year3.58%
Revenue Next 2Y5.1%
Revenue Next 3Y3.43%
Revenue Next 5Y7.97%
EBIT growth 1Y18.54%
EBIT growth 3Y26.05%
EBIT growth 5Y24.59%
EBIT Next Year4.25%
EBIT Next 3Y6.95%
EBIT Next 5Y6.01%
FCF growth 1Y-21.53%
FCF growth 3Y-8.84%
FCF growth 5Y21.71%
OCF growth 1Y-20.24%
OCF growth 3Y-8.14%
OCF growth 5Y18.21%