Toll Brothers Inc (TOL): Today's Featured Materials & Construction 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 Materials & Construction industry lower today making it today's featured Materials & Construction laggard. The industry as a whole closed the day down 1.7%. By the end of trading, Toll Brothers fell $0.90 (-2.6%) to $33.14 on average volume. Throughout the day, 5,302,949 shares of Toll Brothers exchanged hands as compared to its average daily volume of 4,233,700 shares. The stock ranged in price between $33.11-$34.49 after having opened the day at $34.38 as compared to the previous trading day's close of $34.04. Other companies within the Materials & Construction industry that declined today were: Real Goods Solar ( RSOL), down 7.2%, Gafisa ( GFA), down 6.5%, Homex Development ( HXM), down 5.4% and Plum Creek Timber ( PCL), down 4.7%.
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Toll Brothers, Inc., together with its subsidiaries, designs, builds, markets, and arranges finance for detached and attached homes in luxury residential communities. It is also involved in building or converting existing rental apartment buildings into high-, mid-, and low-rise luxury homes. Toll Brothers has a market cap of $5.7 billion and is part of the industrial goods sector. The company has a P/E ratio of 11.4, below the S&P 500 P/E ratio of 17.7. Shares are up 5.3% year to date as of the close of trading on Tuesday. Currently there are 8 analysts that rate Toll Brothers a buy, 2 analysts rate it a sell, and 6 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, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, notable return on equity and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins.

On the positive front, A V Homes ( AVHI), down 20.6%, Comstock ( CHCI), down 1.8%, China Recycling Energy Corporation ( CREG), down 1.8% and Vertex Energy ( VTNR), down 1.7%.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the materials & construction industry could consider SPDR S&P Homebuilders ETF ( XHB) while those bearish on the materials & construction industry could consider ProShares Short Basic Materials Fd ( SBM).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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