Toll Brothers Stock is a rocket launcher
Residential home builder Toll Brothers (NYSE: TOL) The stock has been unstoppable in 2021 with a strong real estate market despite rising material costs. Stocks rebounded sharply following the explosion in fourth quarter FY2021 results. The company raised its guidance even after gaining $ 0.52 per share. Supply chain disruptions and labor constraints have impacted the timing of door-to-door deliveries later than expected, but the order backlog remains large at $ 10.5 billion. Although the Federal Reserve has forecast at least two rate hikes in 2022, demand for residential housing continues to be the engine of growth. Cautious investors looking for exposure to a leading residential homebuilder can watch for timely pullbacks in Toll Brothers shares.
Publication of results for the fourth quarter of fiscal 2021
On December 7, 2021, Toll Brothers released its fourth quarter 2021 tax results for the quarter ending October 2021. The company reported earnings per share (EPS) of $ 3.02, beating consensus analysts’ estimates for a profit of $ 2.50, or $ 0.52. to beat. Revenue increased 19.5% year-over-year (YoY) to $ 3.04 billion, beating consensus analysts’ estimates of $ 2.91 billion. Home sales revenue was $ 2.95 billion, up 18% year-on-year. Homes delivered rose 14% to 3,341, below previous forecast of $ 3,450. The value of the backlog increased 49% to $ 9.5 billion with 10,302 units, up 32%.
Toll Brothers CEO Douglas Yearley Jr. commented: âWe are very pleased with our fourth quarter results, which caps an extraordinary year of record revenue, profits, contracts and backlog value for Toll Brothers. . In the fourth quarter, we increased home sales revenue by 18%, achieved an adjusted gross margin of 25.9% and nearly doubled our profit before tax and earnings per share from a year ago. Additionally, we continued to improve the capital efficiency of our land acquisition strategy, with optional lots now accounting for 55% of our total 80,900 lots at the end of the quarter, up from 43% a year ago. year. Our fourth quarter results, combined with our strategy of capital optimization and operational efficiency, contributed to an 830 basis point increase in our annual opening return on equity to 17.1%. Demand remains very strong. The housing market continues to benefit from strong fundamentals including favorable demographics, pent-up demand from more than a decade of underproduction of new homes, low mortgage rates, a tight resale market and permanent changes in the way Americans view life, work and home. . We believe these trends will continue to generate strong demand for our active, first-time adult communities, which are growing up and well into the future. “
He continued, âWe, like the rest of the industry, continue to face significant supply chain and labor constraints that extend delivery times for our homes. Notwithstanding these issues, which we expect to continue for the foreseeable future, we forecast 20% revenue growth in fiscal 2022. In a year of record sales, we increased our number of communities by 7 % to reach 340 communities at the end of the fiscal year. We continue to project 10% growth in the number of communities by FY2022 and currently own or control enough land for significant additional growth in FY2023. Based on the high prices built into our Record backlog of $ 9.5 billion, we expect growth of 250 basis points. improved full-year adjusted gross margin, which we expect to be weighted in the second half of the year as peak spring 2020 lumber prices impact our first half shipments. Driven in part by our permanent pivot towards a more capital-efficient land strategy, we also expect a further significant increase in our initial return on equity to well above 20%.
The company has released upward guidance estimates for fiscal 2022 for 20% revenue growth to $ 10.55 billion, from $ 10.32 billion according to consensus analysts’ estimates. The company noted that significant supply chain issues and labor constraints have extended delivery times for homes. Home deliveries for fiscal 2022 are expected to be between 11,250 and 12,000 units, with the first fiscal quarter expected to deliver 2,000 units.
TOL Opportunistic Withdrawal Levels
Using the gun charts over the weekly and daily periods provides an accurate short-term view of the price action playing field for TOL stocks. The guns weekly chart peaked at $ 75.61 and fell to $ 65.64 Fibonacci level (fib) on the high market structure (MSH) trigger at $ 65.56 before rising again. The weekly guns chart resumed its bullish trend as the stock rose through its 5-period rising moving average (MA) to $ 70.69, followed by its 15-period rising MA to $ 64.03 . The weekly uptrend started on the weekly weak market structure (MSL) buy triggered above $ 60.39. Weekly Upper Bollinger Bands (BB) sit near the fib level of $ 76.76. The Weekly Stochastic first crossed and stalled above the 80 band to set up a hit or miss situation. The daily gun chart breakout attempts to form a mini stochastic puppy if the daily 5 period MA holds at $ 71.74. Meanwhile, the 15-period MA was flat at $ 70.75. The daily top BBs on a mini puppy are $ 75.47. Cautious investors can watch for opportunistic withdrawal levels at the $ 70.18, $ 68.12, $ 65.64, $ 64.36, $ 62.21, and $ 60.39 levels. The upward trajectories range from the level of $ 76.76 to a level of $ 85.75.
Should you invest $ 1,000 in Toll Brothers right now?
Before you consider Toll Brothers, you’ll want to hear this.
MarketBeat tracks Wall Street’s top-rated and top-performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat identified the five stocks that top analysts quietly whisper to their clients to buy now before the broader market takes hold ofâ¦ and Toll Brothers was not on the list.
While Toll Brothers currently has a âHoldâ rating among analysts, top-rated analysts believe these five stocks are better bets.
See the 5 actions here
Companies mentioned in this article
Compare these actions Add these actions to my watchlist