How does TOLL BROTHERS INC (NYSE:TOL) stack up against Peter Lynch’s investment principles?

Lynch preferred companies with low P/E ratios relative to growth, manageable debt, and strong profitability. In this analysis, we see if TOLL BROTHERS INC (NYSE:TOL) fits his winning formula.

Following Peter Lynch’s approach: Does TOLL BROTHERS INC (NYSE:TOL) fit the bill?

• TOL demonstrates a strong Return on Equity(ROE) of 19.36%. This indicates the company's ability to generate favorable returns for shareholders and reflects its efficient utilization of capital. TOLL BROTHERS INC shows promising potential for continued success.
• A Debt/Equity ratio of 0.35 highlights TOL's commitment to maintaining financial stability.
• The 5-year EPS growth of TOL (27.96) highlights the company's ability to consistently improve its earnings performance and suggests a positive outlook for future profitability.
• A PEG ratio of 0.28 positions TOL as a well-valued growth stock in today’s market.
• TOL maintains a healthy liquidity position with a Current Ratio of 3.83.

What else is there to say on the fundamentals of TOL?

ChartMill assigns a proprietary Fundamental Rating to each stock. The score is computed daily by evaluating various fundamental indicators and properties. The score ranges from 0 to 10.

TOL gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 64 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. A decent growth rate in combination with a cheap valuation! Better keep an eye on TOL. These ratings could make TOL a good candidate for value investing.

Our latest full fundamental report of TOL contains the most current fundamental analsysis.

More Affordable Growth stocks can be found in our Peter Lynch screener.

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.