Toll Brothers (NYSE:TOL) Shares Gap Up - Should You Buy?

Key Points

• Toll Brothers shares gapped up — the stock opened at $153.65 after closing at $147.29 and last traded around $151.60 on elevated volume, while analysts maintain a consensus "Moderate Buy" with an average price target of $164.44.
• Quarterly results topped expectations — Q EPS was $2.19 vs $2.05 est. and revenue $2.15B vs $1.86B (up 15.4% year‑over‑year), and the company raised its quarterly dividend to $0.26 (annualized $1.04, 0.7% yield).
• Notable insider selling amid heavy institutional ownership — CEO Douglas Yearley sold 45,116 shares at about $160.42, while hedge funds and institutions own roughly 91.8% of the company.

Toll Brothers Inc. (NYSE:TOL - Get Free Report)'s stock price gapped up prior to trading on Tuesday . The stock had previously closed at $147.29, but opened at $153.65. Toll Brothers shares last traded at $151.5950, with a volume of 133,472 shares traded.

Analyst Ratings Changes

Several equities research analysts have recently commented on TOL shares. Citizens Jmp reaffirmed a "market outperform" rating and issued a $175.00 target price on shares of Toll Brothers in a research report on Wednesday, February 18th. Barclays dropped their target price on shares of Toll Brothers from $116.00 to $115.00 and set an "underweight" rating for the company in a research report on Wednesday, April 8th. Royal Bank Of Canada raised their target price on shares of Toll Brothers from $144.00 to $161.00 and gave the stock an "outperform" rating in a research report on Thursday, February 19th. Truist Financial dropped their target price on shares of Toll Brothers from $190.00 to $170.00 and set a "buy" rating for the company in a research report on Thursday. Finally, JPMorgan Chase & Co. increased their price target on shares of Toll Brothers from $141.00 to $143.00 and gave the stock an "overweight" rating in a research note on Monday, February 23rd. One investment analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating, five have given a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat.com, the company currently has an average rating of "Moderate Buy" and an average price target of $164.44.

Toll Brothers Stock Performance

The firm has a market capitalization of $14.14 billion, a P/E ratio of 10.66, a price-to-earnings-growth ratio of 1.15 and a beta of 1.49. The company has a current ratio of 4.57, a quick ratio of 0.62 and a debt-to-equity ratio of 0.32. The business's 50 day simple moving average is $146.22 and its two-hundred day simple moving average is $141.17.

Toll Brothers (NYSE:TOL - Get Free Report) last released its quarterly earnings data on Tuesday, February 17th. The construction company reported $2.19 earnings per share for the quarter, beating analysts' consensus estimates of $2.05 by $0.14. The business had revenue of $2.15 billion during the quarter, compared to analyst estimates of $1.86 billion. Toll Brothers had a net margin of 12.26% and a return on equity of 16.83%. Toll Brothers's revenue was up 15.4% compared to the same quarter last year. During the same period last year, the business earned $1.75 EPS. Sell-side analysts anticipate that Toll Brothers Inc. will post 12.67 EPS for the current fiscal year.

Toll Brothers Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Friday, April 24th. Stockholders of record on Friday, April 10th will be issued a dividend of $0.26 per share. This represents a $1.04 dividend on an annualized basis and a dividend yield of 0.7%. The ex-dividend date of this dividend is Friday, April 10th. This is a boost from Toll Brothers's previous quarterly dividend of $0.25. Toll Brothers's payout ratio is 7.43%.

Insider Transactions at Toll Brothers

In other news, CEO Douglas C. Jr. Yearley sold 45,116 shares of the firm's stock in a transaction dated Tuesday, February 24th. The shares were sold at an average price of $160.42, for a total transaction of $7,237,508.72. Following the sale, the chief executive officer owned 321,256 shares of the company's stock, valued at $51,535,887.52. This trade represents a 12.31% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this link. Also, Director Stephen F. East sold 1,000 shares of the firm's stock in a transaction dated Wednesday, April 15th. The shares were sold at an average price of $139.70, for a total transaction of $139,700.00. Following the sale, the director directly owned 13,442 shares in the company, valued at approximately $1,877,847.40. The trade was a 6.92% decrease in their position. The SEC filing for this sale provides additional information. Company insiders own 1.37% of the company's stock.

Hedge Funds Weigh In On Toll Brothers

A number of institutional investors and hedge funds have recently made changes to their positions in the business. Greenhaven Associates Inc. boosted its holdings in shares of Toll Brothers by 0.4% in the fourth quarter. Greenhaven Associates Inc. now owns 5,603,187 shares of the construction company's stock worth $757,663,000 after buying an additional 22,218 shares during the last quarter. Capital World Investors boosted its holdings in shares of Toll Brothers by 51.5% in the third quarter. Capital World Investors now owns 5,187,673 shares of the construction company's stock worth $716,625,000 after buying an additional 1,763,211 shares during the last quarter. Price T Rowe Associates Inc. MD boosted its holdings in shares of Toll Brothers by 2,067.8% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 3,303,915 shares of the construction company's stock worth $446,756,000 after buying an additional 3,151,509 shares during the last quarter. Dimensional Fund Advisors LP boosted its holdings in shares of Toll Brothers by 1.4% in the third quarter. Dimensional Fund Advisors LP now owns 2,901,015 shares of the construction company's stock worth $400,745,000 after buying an additional 39,987 shares during the last quarter. Finally, Holocene Advisors LP boosted its holdings in shares of Toll Brothers by 78.0% in the third quarter. Holocene Advisors LP now owns 2,224,289 shares of the construction company's stock worth $307,263,000 after buying an additional 974,567 shares during the last quarter. Hedge funds and other institutional investors own 91.76% of the company's stock.

About Toll Brothers

Toll Brothers, Inc is a publicly traded homebuilding company that focuses on designing and constructing luxury residential properties. The company's core business encompasses a broad range of housing products, including custom single-family homes, upscale condominium communities and rental apartment ventures. Toll Brothers emphasizes high-end finishes and architectural craftsmanship, positioning itself in the premium segment of the U.S. housing market.

In addition to traditional homebuilding, Toll Brothers operates specialized divisions to address evolving consumer preferences.

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