In the latest trading session, Toll Brothers (TOL) closed at $135.65, marking a +1.04% move from the previous day. This change outpaced the S&P 500's 0.21% gain on the day. Elsewhere, the Dow saw an upswing of 1.18%, while the tech-heavy Nasdaq depreciated by 0.25%.
The home builder's stock has climbed by 5.15% in the past month, exceeding the Construction sector's gain of 1.4% and the S&P 500's gain of 4.36%.
The investment community will be paying close attention to the earnings performance of Toll Brothers in its upcoming release. In that report, analysts expect Toll Brothers to post earnings of $4.91 per share. This would mark year-over-year growth of 6.05%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.32 billion, down 0.28% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $13.82 per share and revenue of $10.85 billion, which would represent changes of -7.93% and 0%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Toll Brothers. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. As of now, Toll Brothers holds a Zacks Rank of #3 (Hold).
In terms of valuation, Toll Brothers is currently trading at a Forward P/E ratio of 9.56. This expresses a discount compared to the average Forward P/E of 11.42 of its industry.
One should further note that TOL currently holds a PEG ratio of 1.57. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Building Products - Home Builders was holding an average PEG ratio of 1.72 at yesterday's closing price.
The Building Products - Home Builders industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 208, finds itself in the bottom 16% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the 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 ReportThis article originally published on Zacks Investment Research (zacks.com).
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