Toll Brothers is an attractively valued luxury homebuilder trading at a forward price-to-earnings ratio of 10.5x with three earnings beats in the last four quarters, but faces declining revenue of -8% year over year and an overbought chart that has already reached analyst price targets, making the risk-reward unfavorable at current levels.
Thesis pillars
- Attractive Forward Valuation→Stable
- Earnings Beat Streak With Declining Revenue→Stable
- Positive News Sentiment Momentum↓Deteriorating
- +1 more pillar — see the Why tab for full reasoning
Toll Brothers, Inc. (TOL) Stock Analysis
Range Bound setup
Consumer Cyclical · Residential Construction
Wait for pullback to $137.88. At $148.60 the A.R:R is 0.3:1 — below the 1.5:1 minimum for BUY_NOW. Engine's entry $137.88 (R/R-minimum solve) is the shallowest technical level that clears the 2:1 A.R:R minimum. Key risks: Analyst target reached - limited upside remaining; Weak overall score: 4.8/10.
Toll Brothers designs, builds, and sells luxury homes across 24 U.S. states and Washington D.C., operating from 446 selling communities and delivering 11,292 homes in fiscal 2025. Revenue comes from luxury home sales — 63% of fiscal 2025 deliveries priced above $750,000 — with a... Read more
Wait for pullback to $137.88. At $148.60 the A.R:R is 0.3:1 — below the 1.5:1 minimum for BUY_NOW. Engine's entry $137.88 (R/R-minimum solve) is the shallowest technical level that clears the 2:1 A.R:R minimum. Key risks: Analyst target reached - limited upside remaining; Weak overall score: 4.8/10. Chart setup: RSI 47 mid-range, Bollinger mid-band. Earnings in 3 days. Wait until post-earnings. Score 4.8/10, moderate confidence.
Passes 3/7 gates (clean insider activity, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and favorable risk/reward ratio and earnings proximity 3d<=7d. Suitability: aggressive.
About Toll Brothers, Inc.
About Toll Brothers, Inc.
Toll Brothers delivered 11,292 homes from 556 communities in fiscal 2025, operating across five geographic regions — North, Mid-Atlantic, South, Mountain, and Pacific — from 446 selling communities in 24 states and Washington D.C. at fiscal year-end October 31, 2025. The company held a $5.49 billion backlog (4,647 homes) at year-end, with approximately 98% expected to deliver in fiscal 2026, and controlled approximately 76,100 home sites, of which 57% were held through options rather than outright ownership.
Toll Brothers' revenue comes entirely from individual home sales priced predominantly above $500,000 — 31% of fiscal 2025 deliveries fell in the $750,000-$1,000,000 range and 27% in the $1,000,000-$2,000,000 range. Structural and finishing options averaged $202,000 per home (24.5% of base price) in fiscal 2025, adding meaningful per-unit revenue. Construction is performed by subcontractors under fixed-price agreements, with Toll Brothers acting as general contractor; the company also operates its own architectural, mortgage, title, and landscaping subsidiaries. About 25% of fiscal 2025 buyers paid the full purchase price in cash, with the remainder financing roughly 69% through third parties. Spec homes represented 54% of fiscal 2025 deliveries, up from 49% in fiscal 2024. California generates a significant portion of total revenues with above-average gross margins relative to the company's blended average, and the company operates across 500 total communities in its five regional segments.
Show full overview
Toll Brothers held 3,043 spec homes at October 31, 2025 — 1,260 completed and 1,783 under construction — creating forward carry exposure if buyer confidence deteriorates. The company notes that in prior downturns, gross margins declined significantly and inventory impairments accumulated. California concentrations amplify this risk: the state carries above-average gross margins, so a California-specific economic, regulatory, or natural-disaster-driven disruption could weigh on consolidated profitability beyond what the geographic footprint suggests. The 10-K identifies high inflation and rising interest rates as the primary demand headwinds of recent years, and if those conditions persist, they could again compress the addressable buyer pool for luxury homes.
See also: Consumer Cyclical · Residential Construction
From Toll Brothers, Inc.'s most recent 10-K filing, extracted June 16, 2026.
Recent developments
updated 2026-08-15Recent Developments — Toll Brothers, Inc.
Latest news
- NEWS Toll Brothers Inc. (NYSE:TOL) Given Consensus Rating of "Moderate Buy" by Brokerages - MarketBeat — MarketBeat positive
- NEWS Toll Brothers (TOL) Stock Slides as Market Rises: Facts to Know Before You Trade - Yahoo Finance — Yahoo Finance negative
- NEWS Toll Brothers Announces Final Opportunity for Luxury Living at Santa Rosa Valley Estates in California - markets.busines — markets.businessinsider.com positive
- NEWS Toll Brothers (TOL) Stock Sinks As Market Gains: Here's Why - Yahoo Finance — Yahoo Finance negative
- NEWS Wells Fargo Remains a Buy on Toll Brothers (TOL) - The Globe and Mail — The Globe and Mail positive
Generated 2026-08-15T17:17:26Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- MEDIUMGeographicCalifornia10-K Item 1A: 'A significant portion of our revenues and income from operations are concentrated in California'
Material Events(8-K, last 90d)
- 2026-05-13Item 5.02MEDIUMPresident and COO Robert Parahus notified company of retirement effective June 30, 2026. EVP Seth J. Ring appointed successor as President and COO, also elected to Board effective June 30, 2026. Clean handoff with named successor.SEC filing →
- 2026-03-31Item 5.02MEDIUMKarl K. Mistry became CEO effective March 30, 2026 per previously announced succession plan; Douglas C. Yearley, Jr. became Executive Chairman. Board expanded from 9 to 10 members with Mistry's appointment as Director (term to 2027 annual meeting). Clean handoff.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
2 floor-breakers
Revenue shrinking — -7.6% YoY. Growth thesis broken unless recovery story develops.static
Momentum below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Wait for pullback to $137.88. At $148.60 the A.R:R is 0.3:1 — below the 1.5:1 minimum for BUY_NOW. Engine's entry $137.88 (R/R-minimum solve) is the shallowest technical level that clears the 2:1 A.R:R minimum. Key risks: Analyst target reached - limited upside remaining; Weak overall score: 4.8/10. Chart setup: RSI 47 mid-range, Bollinger mid-band. Earnings in 3 days. Wait until post-earnings. Target $151.38 (+1.9%), stop $128.88 (−15.3%), A.R:R 0.3:1. Score 4.8/10, moderate confidence.
Take-profit target: $151.38 (+2.1% upside). Target $151.38 (+1.9%), stop $128.88 (−15.3%), A.R:R 0.3:1. Stop-loss: $128.88.
Analyst target reached - limited upside remaining; Weak overall score: 4.8/10; Weak growth.
Toll Brothers, Inc. trades at a P/E of 11.3 (forward 10.5). TrendMatrix value score: 7.3/10. Verdict: Buy (Wait for Entry).
23 analysts cover TOL with a consensus score of 4.0/5. Average price target: $168.
What does Toll Brothers, Inc. do?Toll Brothers designs, builds, and sells luxury homes across 24 U.S. states and Washington D.C., operating from 446...
Toll Brothers designs, builds, and sells luxury homes across 24 U.S. states and Washington D.C., operating from 446 selling communities and delivering 11,292 homes in fiscal 2025. Revenue comes from luxury home sales — 63% of fiscal 2025 deliveries priced above $750,000 — with a $5.49 billion backlog at October 31, 2025 expected to deliver approximately 98% in fiscal 2026. California generates a significant portion of revenues with above-average gross margins.