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    Toro (TTC): Reassessing Valuation After Earnings Beat, Strong Guidance, and New Capital Return Plans

    Simply Wall St·12/20/2025 23:24:51
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    Toro (TTC) just delivered a quarter that cleared Wall Street’s bar, leaned on its Professional segment to do the heavy lifting, and paired the beat with upbeat guidance, dividend growth, and fresh buyback firepower.

    See our latest analysis for Toro.

    At a latest share price of $77.67, Toro has enjoyed a 1 month share price return of 13.07%, even though its 1 year total shareholder return of negative 2.71% and 3 year total shareholder return of negative 27.74% show a longer term reset in expectations. This suggests recent momentum is tentatively rebuilding as investors react to earnings, guidance, and the new buyback.

    If Toro’s mix of steady cash returns and cautious growth appeals to you, this is also a good moment to explore aerospace and defense stocks as another way to find resilient, equipment focused names.

    With the stock still trading at a modest discount to analyst targets despite years of derating, are investors getting paid for Toro’s slow and steady turnaround, or is the market already baking in the next leg of growth?

    Most Popular Narrative: 16.1% Undervalued

    With Toro last closing at $77.67 versus a narrative fair value of $92.60, the story leans toward upside if its execution matches expectations.

    Analysts expect the number of shares outstanding to decline by 4.63% per year for the next 3 years.

    To value all of this in today's terms, we will use a discount rate of 8.28%, as per the Simply Wall St company report.

    Read the complete narrative.

    Curious how modest headline growth assumptions still support a higher fair value? The real twist lies in margin expansion, shrinking share count, and a reset earnings multiple. Want to see how those moving parts translate into that target?

    Result: Fair Value of $92.60 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, this optimistic setup could be derailed by a deeper, longer slump in residential demand, or by renewed margin pressure from higher input costs and tariffs.

    Find out about the key risks to this Toro narrative.

    Another Lens on Value

    On earnings, Toro looks less like a bargain. It trades at 24.1 times profit versus a 22.9 fair ratio and about 19.1 for peers, which points to a valuation premium rather than a discount. Is the market sensibly pricing quality, or just paying up for comfort?

    See what the numbers say about this price — find out in our valuation breakdown.

    NYSE:TTC PE Ratio as at Dec 2025
    NYSE:TTC PE Ratio as at Dec 2025

    Build Your Own Toro Narrative

    If you see the numbers differently or want to stress test your own assumptions, you can build a complete narrative in minutes with Do it your way.

    A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Toro.

    Looking for more investment ideas?

    Before you move on, lock in your next potential winner by scanning focused stock shortlists built from hard data, not hype, across different themes and risk levels.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.