Toll Brothers Reports Second Quarter Earnings: What Key Metrics Have to Say

Toll Brothers (NYSE:TOL) reported revenue of $2.84 billion for the quarter ended April 2024, up 13.2% year-over-year. EPS of $3.38 in the same period compared to $2.85 a year ago.

The reported revenues represent a +12.57% surprise compared to the Zacks Consensus Estimate of $2.52 billion. With the consensus EPS estimate of $4.13, the EPS surprise was -18.16%.

While investors closely monitor year-over-year changes in key numbers – revenue and earnings – and how they compare to Wall Street expectations to determine their next course of action, certain key metrics always provide greater insight into a company’s underlying performance.

Because these metrics impact financial performance and earnings, comparing them to year-ago numbers and analyst estimates helps investors more accurately predict stock price performance.

Here are Toll Brothers’ performance in the just-reported quarter in terms of metrics most frequently monitored and predicted by Wall Street analysts:

• Sealed/Delivered – Units: 2,641 compared to 2,461 estimated on average by five analysts.
• Arrears – Units: 7,093 compared to the five analysts’ average estimate of 7,080.
• Average delivery price (total average price per unit): $1,002.30 compared to the average estimate of $1,003.98 based on five analysts.
• Net Contracts – Units: 3,041 compared to 2,858 estimated on average by four analysts.
• Average arrears price: $1,040.20 compared to $1,033.84 estimated by three analysts on average.
• Number of selling communities: 386 compared to 385 estimated on average by three analysts.
• Arrears – value: $7.38 billion compared to two analysts’ average estimate of $7.18 billion.
• Revenue – Home Sales: $2.65 billion compared to $2.43 billion estimated by six analysts on average. Compared to the previous year’s quarter, this number represents a change of +6.3%.
• Revenues – sale of land: $190.47 million compared to three analysts’ average estimate of $82.17 million. The given number represents a year-on-year change of +1028.3%.
• Gross margin – home sales: $683.74 million compared to the average estimate of $642.24 million from four analysts.
• Gross margin – Land sales and others: $177.49 million compared to three analysts’ average estimate of $116.11 million.

Shares of Toll Brothers have gained 15.2% over the past month, compared to a change of 7.1% for the Zacks S&P 500 composite. The stock is currently sporting a Zacks Rank #3 (Hold), which indicates they can perform at par with the broader market.

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