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Toll Brothers (TOL) Stock Sinks As Market Gains: Here's Why

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Toll Brothers (TOL - Free Report) closed the most recent trading day at $132.88, moving -1.15% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.59% for the day. Meanwhile, the Dow experienced a drop of 0.14%, and the technology-dominated Nasdaq saw an increase of 1.2%.

Prior to today's trading, shares of the home builder had lost 5.3% lagged the Construction sector's gain of 5.14% and the S&P 500's gain of 8.64%.

Market participants will be closely following the financial results of Toll Brothers in its upcoming release. The company plans to announce its earnings on May 19, 2026. On that day, Toll Brothers is projected to report earnings of $2.57 per share, which would represent a year-over-year decline of 26.57%. Meanwhile, our latest consensus estimate is calling for revenue of $2.41 billion, down 12.05% from the prior-year quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $12.67 per share and a revenue of $10.64 billion, representing changes of -6.08% and -2.97%, respectively, from the prior year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Toll Brothers. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.29% lower. Currently, Toll Brothers is carrying a Zacks Rank of #4 (Sell).

Digging into valuation, Toll Brothers currently has a Forward P/E ratio of 10.61. This represents a discount compared to its industry average Forward P/E of 13.55.

It's also important to note that TOL currently trades at a PEG ratio of 1.05. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As the market closed yesterday, the Building Products - Home Builders industry was having an average PEG ratio of 1.44.

The Building Products - Home Builders industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 228, which puts it in the bottom 7% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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