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Research Alert: CFRA Upgrades Rating On Shares Of Toll Brothers, Inc. To Hold From Sell

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

Our 12-month target price is $141 (up from $134). This is based on 11x our FY 26 (Oct.) EPS view of $12.78, a premium to its historical P/E mean of 9.4x, reflecting the tight resale market but below its recent ~13x valuation as we expect competition in the segments TOL serves to increase. We lower our FY 26 EPS to $12.78 from $12.81 and FY 27 to $13.55 from $14.11. We see some conservatism in management's revenue guidance, but we also see some skepticism in expectations when it comes to the margin guidance. We think there is potential for these two items to neutralize each other in the current environment. Although higher interest rates do not help on the affordability front, they keep a lid on the existing housing market, which benefits homebuilders. We still expect TOL to face competition from other builders in 2026 but see the wealthier consumer cohorts remaining resilient, helping demand for TOL homes (ahead of small peers). We see TOL's pricing power as a plus as higher transport and input costs loom.

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