Toll Brothers Inc (TOL): Today's Featured Industrial Goods Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Toll Brothers ( TOL) pushed the Industrial Goods sector lower today making it today's featured Industrial Goods laggard. The sector as a whole closed the day up 0.8%. By the end of trading, Toll Brothers fell 63 cents (-1.9%) to $33.12 on light volume. Throughout the day, 2.1 million shares of Toll Brothers exchanged hands as compared to its average daily volume of 3.3 million shares. The stock ranged in price between $32.91-$34.12 after having opened the day at $34.10 as compared to the previous trading day's close of $33.75. Other companies within the Industrial Goods sector that declined today were: Wowjoint Holdings ( BWOW), down 7.9%, China Development Group Corporation ( CTDC), down 6.7%, Cleantech Solutions International ( CLNT), down 5.7%, and GenCorp ( GY), down 4.5%.
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Toll Brothers, Inc., together with its subsidiaries, designs, builds, markets, and arranges finance for single-family detached and attached homes in luxury residential communities. Toll Brothers has a market cap of $5.63 billion and is part of the materials & construction industry. The company has a P/E ratio of 62, below the average materials & construction industry P/E ratio of 63.2 and above the S&P 500 P/E ratio of 17.7. Shares are up 65.3% year to date as of the close of trading on Wednesday. Currently there are seven analysts that rate Toll Brothers a buy, three analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates Toll Brothers as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, solid stock price performance, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows low profit margins.

On the positive front, China Valves Technology ( CVVT), up 22.5%, NF Energy Saving ( NFEC), up 16.6%, Sharps Compliance Corporation ( SMED), up 13.9%, and Edwards Group ( EVAC), up 12.8%, were all gainers within the industrial goods sector with Joy Global ( JOY) being today's featured industrial goods sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the industrial goods sector could consider Industrial Select Sector SPDR ( XLI) while those bearish on the industrial goods sector could consider ProShares Short Dow 30 ( DOG).

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