Toll Brothers (TOL) Reports In-Line Q3 EPS; Guides Q4, FY16

Toll Brothers (NYSE: TOL) reported Q3 EPS of $0.61, in-line with the analyst estimate of $0.61. Revenue for the quarter came in at $1.27 billion versus the consensus estimate of $1.25 billion.

• Net signed contracts of $1.45 billion and 1,748 units rose 18% in dollars and units, compared to FY 2015’s third quarter. The average price of net signed contracts was $831,000, compared to $834,000 in FY 2015’s third quarter.
• Backlog of $4.37 billion and 5,181 units rose 19% in dollars and 17% in units, compared to FY 2015’s third-quarter-end backlog. At FY 2016’s third-quarter end, the average price of homes in backlog was $844,000, compared to $829,000 at FY 2015’s third-quarter end.

Guidance:

The Company expects FY 2016 fourth quarter deliveries of between 2,025 and 2,325 units with an average price of between $815,000 and $835,000. This range results in projected full FY 2016 deliveries of between 5,900 and 6,200 units with an average delivered price of between $840,000 and $850,000. This would result in FY 2016 revenues of between $4.96 billion and $5.27 billion, up approximately 19% to 26% over FY 2015.

Due primarily to a shift in its mix of deliveries, the Company now expects its full FY 2016 Adjusted Gross Margin to be between 25.6% and 25.8% of revenues, which is 30 basis points below the mid-point of its previous guidance.

The Company’s full FY 2016 Other income and Income from unconsolidated entities is now expected to be between $88.5 million and $93.5 million, down from its previous guidance of $105 million to $130 million, as some of the closings of sold units in joint ventures originally projected for this fourth quarter will instead be delivered early in FY 2017.

For earnings history and earnings-related data on Toll Brothers (TOL) click here.

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