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Toll Brothers (TOL) Rewards Investors With a 5% Dividend Hike
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Toll Brothers, Inc. (TOL - Free Report) announced an increase in the dividend payout, emphasizing its sustainable growth and ability to deliver long-term shareholder value.
The board of directors approved a 5% hike in its quarterly cash dividend to 21 cents per share (84 cents annually) from 20 cents (80 cents annually). The new dividend will be paid out on Apr 21 to shareholders of record as of Apr 6, 2023. The dividend yield, based on TOL’s Mar 9 closing price, is approximately 1.44%.
Consistent Dividend
Toll Brothers has always shown an increasing trend in its dividend payouts, having raised the same in the last three fiscal years. Its financial strength, liquidity, solid backlog levels and increased house prices can be considered as the driving factors behind the dividend hike.
As of fiscal 2023 first-quarter end, the company had cash and cash equivalents of $791.6 million compared with $671.4 million as of the first quarter of fiscal 2022. The company has $1.8 billion available from its $1.9 billion revolving credit facility.
As of fiscal first-quarter 2023, the company had a total backlog of $8.6 billion and expects solid long-term results starting fiscal 2023. The average price per home in the present backlog is $1,110,200, up 16.1% from the prior-year quarter. Gross margin of home sales as a percentage of revenues increased 200 basis points in the first quarter of fiscal 2023 from the prior year quarter.
For this luxury house and community-building company, the lack of competition in this market is adding to its growth drivers. Based on the land TOL owns or controls, it expects to grow the community count by 10% by the end of fiscal 2023. The company’s extensive geographic footprint and deep land position will allow it to grow its community count in fiscal 2023 and beyond, attributable to the sale of existing communities faster than anticipated.
Image Source: Zacks Investment Research
Shares of Toll Brothers have risen 17.8% over the past three months, outperforming the Zacks Building Products - Home Builders industry’s growth of 13.4%.
Some other top-ranked stocks in the Zacks Construction sector are:
United Rentals, Inc. (URI - Free Report) currently carries a Zacks Rank #2. Shares of URI have gained 44.8% in the past six months. The long-term earnings growth rate of the company is 16.3%.
The Zacks Consensus Estimate for URI’s 2023 sales and EPS indicates growth of 20.3% and 28.3%, respectively, from the previous year’s reported levels.
Sterling Infrastructure, Inc. (STRL - Free Report) currently carries a Zacks Rank #2. STRL has a trailing four-quarter earnings surprise of 19.3%, on average. Shares of the company have gained 61.8% in the past six months.
The Zacks Consensus Estimate for STRL’s 2023 sales indicates a 0.8% decline, while that for EPS suggests 10.8% growth.
Skyline Champion Corporation (SKY - Free Report) currently carries a Zacks Rank #2. SKY has a trailing four-quarter earnings surprise of 43.2%, on average. Its shares have rallied 15.9% in the past six months.
The Zacks Consensus Estimate for SKY’s fiscal 2024 sales and EPS indicates a decline of 11.7% and 30.2%, respectively, from the previous year.
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Toll Brothers (TOL) Rewards Investors With a 5% Dividend Hike
Toll Brothers, Inc. (TOL - Free Report) announced an increase in the dividend payout, emphasizing its sustainable growth and ability to deliver long-term shareholder value.
The board of directors approved a 5% hike in its quarterly cash dividend to 21 cents per share (84 cents annually) from 20 cents (80 cents annually). The new dividend will be paid out on Apr 21 to shareholders of record as of Apr 6, 2023. The dividend yield, based on TOL’s Mar 9 closing price, is approximately 1.44%.
Consistent Dividend
Toll Brothers has always shown an increasing trend in its dividend payouts, having raised the same in the last three fiscal years. Its financial strength, liquidity, solid backlog levels and increased house prices can be considered as the driving factors behind the dividend hike.
As of fiscal 2023 first-quarter end, the company had cash and cash equivalents of $791.6 million compared with $671.4 million as of the first quarter of fiscal 2022. The company has $1.8 billion available from its $1.9 billion revolving credit facility.
As of fiscal first-quarter 2023, the company had a total backlog of $8.6 billion and expects solid long-term results starting fiscal 2023. The average price per home in the present backlog is $1,110,200, up 16.1% from the prior-year quarter. Gross margin of home sales as a percentage of revenues increased 200 basis points in the first quarter of fiscal 2023 from the prior year quarter.
For this luxury house and community-building company, the lack of competition in this market is adding to its growth drivers. Based on the land TOL owns or controls, it expects to grow the community count by 10% by the end of fiscal 2023. The company’s extensive geographic footprint and deep land position will allow it to grow its community count in fiscal 2023 and beyond, attributable to the sale of existing communities faster than anticipated.
Image Source: Zacks Investment Research
Shares of Toll Brothers have risen 17.8% over the past three months, outperforming the Zacks Building Products - Home Builders industry’s growth of 13.4%.
Zacks Rank & Other Key Picks
TOL currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some other top-ranked stocks in the Zacks Construction sector are:
United Rentals, Inc. (URI - Free Report) currently carries a Zacks Rank #2. Shares of URI have gained 44.8% in the past six months. The long-term earnings growth rate of the company is 16.3%.
The Zacks Consensus Estimate for URI’s 2023 sales and EPS indicates growth of 20.3% and 28.3%, respectively, from the previous year’s reported levels.
Sterling Infrastructure, Inc. (STRL - Free Report) currently carries a Zacks Rank #2. STRL has a trailing four-quarter earnings surprise of 19.3%, on average. Shares of the company have gained 61.8% in the past six months.
The Zacks Consensus Estimate for STRL’s 2023 sales indicates a 0.8% decline, while that for EPS suggests 10.8% growth.
Skyline Champion Corporation (SKY - Free Report) currently carries a Zacks Rank #2. SKY has a trailing four-quarter earnings surprise of 43.2%, on average. Its shares have rallied 15.9% in the past six months.
The Zacks Consensus Estimate for SKY’s fiscal 2024 sales and EPS indicates a decline of 11.7% and 30.2%, respectively, from the previous year.