Toll Brothers (TOL) ended the recent trading session at $155.13, demonstrating a -1.28% change from the preceding day's closing price. The stock's change was less than the S&P 500's daily gain of 0.72%. At the same time, the Dow added 0.3%, and the tech-heavy Nasdaq gained 1.12%.
Coming into today, shares of the home builder had gained 13.94% in the past month. In that same time, the Construction sector gained 0.11%, while the S&P 500 lost 0.9%.
The investment community will be closely monitoring the performance of Toll Brothers in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $2.9, reflecting a 22.25% decrease from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $2.6 billion, indicating a 11.81% decline compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $12.69 per share and a revenue of $10.7 billion, indicating changes of -5.93% and -2.44%, respectively, from the former year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Toll Brothers. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.18% higher within the past month. Currently, Toll Brothers is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Toll Brothers is presently being traded at a Forward P/E ratio of 12.38. This valuation marks a discount compared to its industry average Forward P/E of 15.51.
We can additionally observe that TOL currently boasts a PEG ratio of 1.3. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Building Products - Home Builders industry currently had an average PEG ratio of 2.58 as of yesterday's close.
The Building Products - Home Builders industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 225, finds itself in the bottom 9% echelons of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Toll Brothers Inc. (TOL): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).