Toll Brothers streamlines director removal process

Toll Brothers , Inc. (NYSE:TOL), a leading construction company with a market capitalization of $10.6 billion, announced amendments to its corporate governance structure following a recent stockholder vote. Currently trading at $106.66, near its 52-week low, the company maintains a strong financial health score of "GREAT" according to InvestingPro analysis. On Tuesday, the company’s shareholders approved a change that now allows for the removal of a director with a simple majority vote, rather than the previous two-thirds requirement.

The decision, detailed in a recent SEC filing, came during Toll Brothers’ Annual Meeting held on March 11, 2025. The change to the company’s Second Restated Certificate of Incorporation aims to facilitate greater flexibility in board management, reflecting evolving standards in corporate governance. According to InvestingPro data, the company has demonstrated strong financial discipline, maintaining dividend payments for 9 consecutive years while operating with a moderate level of debt.

In addition to the governance amendment, shareholders re-elected all board members, with votes for each director exceeding 72 million in favor. The company also successfully ratified the re-appointment of its independent registered public accounting firm with over 85 million votes in favor.

Furthermore, an advisory vote on executive compensation, commonly referred to as "Say on Pay," passed with over 76 million votes in support. This non-binding vote indicates shareholder approval of the company’s executive compensation policies and practices.

The amendment to the Certificate of Incorporation was one of four proposals submitted for a vote at the Annual Meeting. The detailed results of each proposal, including the exact number of votes for, against, and abstained, as well as broker non-votes, were disclosed in the SEC filing.

The filing also included the Certificate of Amendment, which formalizes the approved changes in the company’s governance documents. These documents are available for public review as part of the company’s regulatory filings.

Toll Brothers, incorporated in Delaware and headquartered in Fort Washington, PA, is known for its luxury homebuilding operations. The company’s fiscal year ends on October 31, as per its SEC filings.

This news is based on a press release statement and reflects the latest developments in Toll Brothers’ corporate governance.

In other recent news, Toll Brothers reported its fiscal first-quarter 2025 earnings, which fell short of expectations. The company posted an earnings per share (EPS) of $1.75, below the forecasted $2.04, and revenue of $1.84 billion, missing the anticipated $1.91 billion. Despite this, Toll Brothers increased its quarterly cash dividend by 9% to $0.25 per share, marking its fifth consecutive year of dividend growth. Analysts have adjusted their outlooks on the company, with Keefe, Bruyette & Woods reducing their price target to $132 and Citi lowering it to $123, both maintaining neutral ratings. RBC Capital also revised its price target to $139, citing mixed demand signals and a softer first-half performance. The company maintained its full-year guidance for deliveries and margins, projecting improvements in gross margins due to a higher number of luxury deliveries. These developments reflect Toll Brothers’ current positioning amidst a fluctuating real estate market.

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