A Glimpse of Toll Brothers's Earnings Potential

Toll Brothers (NYSE:TOL) is set to give its latest quarterly earnings report on Tuesday, 2025-05-20. Here's what investors need to know before the announcement.

Analysts estimate that Toll Brothers will report an earnings per share (EPS) of $2.88.

Anticipation surrounds Toll Brothers's announcement, with investors hoping to hear about both surpassing estimates and receiving positive guidance for the next quarter.

New investors should understand that while earnings performance is important, market reactions are often driven by guidance.

Performance in Previous Earnings

During the last quarter, the company reported an EPS missed by $0.30, leading to a 5.87% drop in the share price on the subsequent day.

Here's a look at Toll Brothers's past performance and the resulting price change:

Quarter	Q1 2025	Q4 2024	Q3 2024	Q2 2024
EPS Estimate	2.05	4.34	3.31	4.14
EPS Actual	1.75	4.63	3.60	3.38
Price Change %	-6.0%	-7.000000000000001%	6.0%	-8.0%

Stock Performance

Shares of Toll Brothers were trading at $107.26 as of May 16. Over the last 52-week period, shares are down 19.52%. Given that these returns are generally negative, long-term shareholders are likely bearish going into this earnings release.

Analysts' Take on Toll Brothers

For investors, grasping market sentiments and expectations in the industry is vital. This analysis explores the latest insights regarding Toll Brothers.

The consensus rating for Toll Brothers is Outperform, based on 13 analyst ratings. With an average one-year price target of $139.23, there's a potential 29.81% upside.

Understanding Analyst Ratings Among Peers

This comparison focuses on the analyst ratings and average 1-year price targets of TopBuild, Taylor Morrison Home and Champion Homes, three major players in the industry, shedding light on their relative performance expectations and market positioning.

• Analysts currently favor an Buy trajectory for TopBuild, with an average 1-year price target of $358.0, suggesting a potential 233.77% upside.
• Analysts currently favor an Outperform trajectory for Taylor Morrison Home, with an average 1-year price target of $71.83, suggesting a potential 33.03% downside.
• Analysts currently favor an Neutral trajectory for Champion Homes, with an average 1-year price target of $97.0, suggesting a potential 9.57% downside.

Peer Metrics Summary

The peer analysis summary presents essential metrics for TopBuild, Taylor Morrison Home and Champion Homes, unveiling their respective standings within the industry and providing valuable insights into their market positions and comparative performance.

Company	Consensus	Revenue Growth	Gross Profit	Return on Equity
Toll Brothers	Outperform	-4.55%	$459.55M	2.30%
TopBuild	Buy	-3.55%	$351.47M	5.70%
Taylor Morrison Home	Outperform	11.55%	$463.27M	3.61%
Champion Homes	Neutral	15.28%	$181.02M	4.07%

Key Takeaway:

Toll Brothers ranks at the bottom for Revenue Growth among its peers. It is in the middle for Gross Profit. For Return on Equity, Toll Brothers is at the bottom compared to its peers.

Get to Know Toll Brothers Better

Toll Brothers is the leading luxury homebuilder in the United States with an average sale price well above public competitors'. The company operates in over 60 markets across 24 states and caters to move-up, active-adult, and second-homebuyers. Traditional homebuilding operations represent most of company's revenue. Toll Brothers also builds luxury for-sale and for-rent properties in urban centers across the US It has its headquarters in Horsham, Pennsylvania.

Toll Brothers: Financial Performance Dissected

Market Capitalization: Surpassing industry standards, the company's market capitalization asserts its dominance in terms of size, suggesting a robust market position.

Negative Revenue Trend: Examining Toll Brothers's financials over 3 months reveals challenges. As of 31 January, 2025, the company experienced a decline of approximately -4.55% in revenue growth, reflecting a decrease in top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Consumer Discretionary sector.

Net Margin: Toll Brothers's net margin excels beyond industry benchmarks, reaching 9.56%. This signifies efficient cost management and strong financial health.

Return on Equity (ROE): Toll Brothers's ROE lags behind industry averages, suggesting challenges in maximizing returns on equity capital. With an ROE of 2.3%, the company may face hurdles in achieving optimal financial performance.

Return on Assets (ROA): The company's ROA is below industry benchmarks, signaling potential difficulties in efficiently utilizing assets. With an ROA of 1.32%, the company may need to address challenges in generating satisfactory returns from its assets.

Debt Management: Toll Brothers's debt-to-equity ratio is below the industry average at 0.37, reflecting a lower dependency on debt financing and a more conservative financial approach.

To track all earnings releases for Toll Brothers visit their earnings calendar on our site.

This article was generated by Benzinga's automated content engine and reviewed by an editor.