How are energy investors positioned?
Investing.com - Goldman Sachs has reiterated its Neutral rating and $135.00 price target on Toll Brothers (NYSE:TOL) stock, currently trading at $131.58 with a market capitalization of $12.91 billion. The investment bank cited ongoing uncertainty in operating conditions reflected in the company’s fiscal third-quarter results and fourth-quarter guidance. According to InvestingPro, the company maintains a strong financial health score of "GREAT."
The investment bank noted that Toll Brothers is prioritizing profitability preservation, suggesting that current estimates could prove conservative if mortgage rates decline further while macroeconomic expansion continues. The company trades at an attractive P/E ratio of 9.66, suggesting room for potential value appreciation.
Goldman Sachs expects Toll Brothers to maintain a balanced approach to capital allocation, including a projected $610 million in share repurchases next year that would reduce the share count by approximately 5%, following a similar reduction this year. InvestingPro data confirms management’s aggressive share buyback strategy, with additional insights available in the Pro Research Report.
This share count reduction is expected to boost Goldman’s earnings per share estimate for the company by 3%, as Toll Brothers focuses on reducing volatility and emphasizing returns and cash generation through market cycles.
Despite these positive factors, Goldman Sachs maintained its Neutral stance, noting that with Toll Brothers stock up 51% since early April and limited visibility into future performance, any potential upside appears fully captured in the current valuation. InvestingPro analysis suggests the stock is currently fairly valued, with 8 additional exclusive ProTips available to subscribers.
In other recent news, Toll Brothers reported strong financial results for the third quarter of 2025, exceeding analysts’ expectations. The company achieved earnings per share of $3.73, surpassing the forecasted $3.60, and generated revenue of $2.9 billion, which was above the anticipated $2.86 billion. RBC Capital raised its price target for Toll Brothers to $145 from $133, maintaining an Outperform rating, citing an upward adjustment in the fiscal year 2025 earnings estimate despite a reduction for 2026 due to softer orders. Wells Fargo (NYSE:WFC) also increased its price target to $160 from $150, keeping an Overweight rating, and highlighted improved performance in June and July as factors for its optimistic outlook. UBS reiterated its Buy rating with a $183 price target, expressing a positive outlook for Toll Brothers and the homebuilding sector heading into 2026, despite concerns about the company’s fourth-quarter guidance. These developments reflect a mix of analyst perspectives and adjustments following Toll Brothers’ recent earnings call.
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