Toll Brothers staging a turnaround in tough market (TOL)

Toll Brothers, Inc. (TOL) is a luxury home builder active in nineteen states. Given the state of the housing market, one would expect poor performance, but according to TOL’s 1Q 2011 earnings release on 2/23/2011, the company has staged a comeback:

The Company reported FY 2011 first quarter net income of $3.4 million, or $0.02 per share diluted, compared to a FY 2010 first quarter net loss of $40.8 million, or $0.25 per share diluted.

FY 2011’s first quarter revenues and home building deliveries of $334.1 million and 570 units rose 2% in dollars and declined 4% in units compared to FY 2010’s first quarter results. FY 2011’s first quarter average delivery price of $586,000 was 7% higher than FY 2010’s same period average price.

Moreover, according to the Associated Press, TOL’s performance is particularly impressive given the context of its 2010 comparisons:

CEO Douglas Yearley Jr., delivered more positive news along with the quarterly results: The company’s national spring sales event, which ends this weekend and offers buyers upgrades on home features such as cabinets and kitchen fixtures, has already brought in 15 percent more deposits than last year.

That’s noteworthy, considering the industry got a big boost last spring from federal tax credits offered to entice reluctant buyers.

No Covestor models hold TOL as of end of day 2/25/11.


“Toll Brothers Reports FY 2011 1st Qtr Results” Toll Brothers, 2/23/2011.

“Toll Brothers posts surprise 1st-quarter profit” Alex Veiga. Associated Press, 2/23/2011.