TOLL BROTHERS INC (TOL) Stock Fundamental Analysis
NYSE:TOL - New York Stock Exchange, Inc. - US8894781033 - Common Stock - Currency: USD
TOL gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 63 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. TOL is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
TOL had positive earnings in the past year.
In the past year TOL had a positive cash flow from operations.
Each year in the past 5 years TOL has been profitable.
In the past 5 years TOL always reported a positive cash flow from operatings.
1.2 Ratios
TOL has a better Return On Assets (9.72%) than 79.37% of its industry peers.
TOL's Return On Equity of 17.36% is fine compared to the rest of the industry. TOL outperforms 77.78% of its industry peers.
TOL has a better Return On Invested Capital (12.34%) than 76.19% of its industry peers.
TOL had an Average Return On Invested Capital over the past 3 years of 13.26%. This is above the industry average of 10.39%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.72% | ||
| ROE | 17.36% | ||
| ROIC | 12.34% |
ROA(3y)11.06%
ROA(5y)8.89%
ROE(3y)20.7%
ROE(5y)17.4%
ROIC(3y)13.26%
ROIC(5y)10.59%
1.3 Margins
Looking at the Profit Margin, with a value of 12.95%, TOL belongs to the top of the industry, outperforming 92.06% of the companies in the same industry.
TOL's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 16.72%, TOL belongs to the best of the industry, outperforming 90.48% of the companies in the same industry.
In the last couple of years the Operating Margin of TOL has grown nicely.
The Gross Margin of TOL (26.21%) is comparable to the rest of the industry.
TOL's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.72% | ||
| PM (TTM) | 12.95% | ||
| GM | 26.21% |
OM growth 3Y17.51%
OM growth 5Y14.86%
PM growth 3Y15.15%
PM growth 5Y12.14%
GM growth 3Y8.08%
GM growth 5Y7.34%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), TOL is creating some value.
Compared to 1 year ago, TOL has less shares outstanding
TOL has less shares outstanding than it did 5 years ago.
The debt/assets ratio for TOL has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.97 indicates that TOL is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 3.97, TOL is doing good in the industry, outperforming 66.67% of the companies in the same industry.
TOL has a debt to FCF ratio of 3.87. This is a good value and a sign of high solvency as TOL would need 3.87 years to pay back of all of its debts.
TOL's Debt to FCF ratio of 3.87 is fine compared to the rest of the industry. TOL outperforms 66.67% of its industry peers.
TOL has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.35, TOL is in line with its industry, outperforming 41.27% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 3.87 | ||
| Altman-Z | 3.97 |
ROIC/WACC1.44
WACC8.6%
2.3 Liquidity
TOL has a Current Ratio of 3.54. This indicates that TOL is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 3.54, TOL is doing good in the industry, outperforming 68.25% of the companies in the same industry.
A Quick Ratio of 0.29 indicates that TOL may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.29, TOL is doing worse than 92.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.54 | ||
| Quick Ratio | 0.29 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.07% over the past year.
Measured over the past years, TOL shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.96% on average per year.
TOL shows a small growth in Revenue. In the last year, the Revenue has grown by 1.59%.
The Revenue has been growing by 8.47% on average over the past years. This is quite good.
EPS 1Y (TTM)0.07%
EPS 3Y27.67%
EPS 5Y27.96%
EPS Q2Q%3.55%
Revenue 1Y (TTM)1.59%
Revenue growth 3Y7.26%
Revenue growth 5Y8.47%
Sales Q2Q%2.25%
3.2 Future
Based on estimates for the next years, TOL will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.53% on average per year.
Based on estimates for the next years, TOL will show a small growth in Revenue. The Revenue will grow by 7.32% on average per year.
EPS Next Y1.85%
EPS Next 2Y2.05%
EPS Next 3Y5.33%
EPS Next 5Y9.53%
Revenue Next Year2.48%
Revenue Next 2Y0.8%
Revenue Next 3Y2.69%
Revenue Next 5Y7.32%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 9.68, which indicates a very decent valuation of TOL.
TOL's Price/Earnings ratio is a bit cheaper when compared to the industry. TOL is cheaper than 69.84% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.84, TOL is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 9.04, the valuation of TOL can be described as reasonable.
Based on the Price/Forward Earnings ratio, TOL is valued a bit cheaper than 74.60% of the companies in the same industry.
TOL is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.29, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.68 | ||
| Fwd PE | 9.04 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TOL indicates a somewhat cheap valuation: TOL is cheaper than 65.08% of the companies listed in the same industry.
71.43% of the companies in the same industry are more expensive than TOL, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.71 | ||
| EV/EBITDA | 8 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of TOL may justify a higher PE ratio.
PEG (NY)5.23
PEG (5Y)0.35
EPS Next 2Y2.05%
EPS Next 3Y5.33%
5. Dividend
5.1 Amount
TOL has a yearly dividend return of 0.76%, which is pretty low.
TOL's Dividend Yield is a higher than the industry average which is at 3.23.
With a Dividend Yield of 0.76, TOL pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.76% |
5.2 History
The dividend of TOL is nicely growing with an annual growth rate of 15.67%!
TOL has been paying a dividend for over 5 years, so it has already some track record.
TOL has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)15.67%
Div Incr Years4
Div Non Decr Years7
5.3 Sustainability
6.91% of the earnings are spent on dividend by TOL. This is a low number and sustainable payout ratio.
TOL's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP6.91%
EPS Next 2Y2.05%
EPS Next 3Y5.33%
130.5
-0.51 (-0.39%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryHousehold Durables
Earnings (Last)
Earnings (Next)
Inst Owners93.18%
Inst Owner Change-2.36%
Ins Owners0.69%
Ins Owner Change-0.66%
Market Cap12.81B
Analysts78.18
Price Target144.57 (10.78%)
Short Float %2.67%
Short Ratio1.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.76% |
Yearly Dividend0.92
Dividend Growth(5Y)15.67%
DP6.91%
Div Incr Years4
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.7%
Min EPS beat(2)-15.06%
Max EPS beat(2)22.46%
EPS beat(4)3
Avg EPS beat(4)5.19%
Min EPS beat(4)-15.06%
Max EPS beat(4)22.46%
EPS beat(8)6
Avg EPS beat(8)8.23%
EPS beat(12)10
Avg EPS beat(12)12.69%
EPS beat(16)14
Avg EPS beat(16)13.65%
Revenue beat(2)1
Avg Revenue beat(2)1.75%
Min Revenue beat(2)-4.38%
Max Revenue beat(2)7.87%
Revenue beat(4)2
Avg Revenue beat(4)1.24%
Min Revenue beat(4)-4.38%
Max Revenue beat(4)7.87%
Revenue beat(8)6
Avg Revenue beat(8)3.37%
Revenue beat(12)9
Avg Revenue beat(12)5.25%
Revenue beat(16)11
Avg Revenue beat(16)4.74%
PT rev (1m)3.51%
PT rev (3m)1.38%
EPS NQ rev (1m)0.03%
EPS NQ rev (3m)-12.68%
EPS NY rev (1m)0%
EPS NY rev (3m)2.55%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-3.39%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)1.34%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.68 | ||
| Fwd PE | 9.04 | ||
| P/S | 1.2 | ||
| P/FCF | 17.71 | ||
| P/OCF | 16.01 | ||
| P/B | 1.61 | ||
| P/tB | 1.61 | ||
| EV/EBITDA | 8 |
EPS(TTM)13.48
EY10.33%
EPS(NY)14.43
Fwd EY11.06%
FCF(TTM)7.37
FCFY5.65%
OCF(TTM)8.15
OCFY6.25%
SpS108.57
BVpS80.96
TBVpS80.96
PEG (NY)5.23
PEG (5Y)0.35
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.72% | ||
| ROE | 17.36% | ||
| ROCE | 16.48% | ||
| ROIC | 12.34% | ||
| ROICexc | 13.18% | ||
| ROICexgc | 13.32% | ||
| OM | 16.72% | ||
| PM (TTM) | 12.95% | ||
| GM | 26.21% | ||
| FCFM | 6.79% |
ROA(3y)11.06%
ROA(5y)8.89%
ROE(3y)20.7%
ROE(5y)17.4%
ROIC(3y)13.26%
ROIC(5y)10.59%
ROICexc(3y)15.3%
ROICexc(5y)12.36%
ROICexgc(3y)15.57%
ROICexgc(5y)12.57%
ROCE(3y)17.71%
ROCE(5y)14.14%
ROICexcg growth 3Y16.35%
ROICexcg growth 5Y20.45%
ROICexc growth 3Y16.42%
ROICexc growth 5Y20.38%
OM growth 3Y17.51%
OM growth 5Y14.86%
PM growth 3Y15.15%
PM growth 5Y12.14%
GM growth 3Y8.08%
GM growth 5Y7.34%
F-Score4
Asset Turnover0.75
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 3.87 | ||
| Debt/EBITDA | 1.5 | ||
| Cap/Depr | 91.65% | ||
| Cap/Sales | 0.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 42.87% | ||
| Profit Quality | 52.41% | ||
| Current Ratio | 3.54 | ||
| Quick Ratio | 0.29 | ||
| Altman-Z | 3.97 |
F-Score4
WACC8.6%
ROIC/WACC1.44
Cap/Depr(3y)93.15%
Cap/Depr(5y)105.24%
Cap/Sales(3y)0.7%
Cap/Sales(5y)0.88%
Profit Quality(3y)72.56%
Profit Quality(5y)113.39%
High Growth Momentum
Growth
EPS 1Y (TTM)0.07%
EPS 3Y27.67%
EPS 5Y27.96%
EPS Q2Q%3.55%
EPS Next Y1.85%
EPS Next 2Y2.05%
EPS Next 3Y5.33%
EPS Next 5Y9.53%
Revenue 1Y (TTM)1.59%
Revenue growth 3Y7.26%
Revenue growth 5Y8.47%
Sales Q2Q%2.25%
Revenue Next Year2.48%
Revenue Next 2Y0.8%
Revenue Next 3Y2.69%
Revenue Next 5Y7.32%
EBIT growth 1Y-11.15%
EBIT growth 3Y26.05%
EBIT growth 5Y24.59%
EBIT Next Year-1.8%
EBIT Next 3Y1.88%
EBIT Next 5Y6.53%
FCF growth 1Y-42.83%
FCF growth 3Y-8.84%
FCF growth 5Y21.71%
OCF growth 1Y-40.17%
OCF growth 3Y-8.14%
OCF growth 5Y18.21%