Stock fact sheet · data as of
Toll Brothers, Inc. (TOL): fair value, margin of safety and Wheel Score
Consumer Cyclical · Residential Construction · United States · Value
Is TOL undervalued?
TOL has a margin of safety of 35%: the stock closed at 130.41 on 16 Oct 2026 against a GLS average fair value of 199.69. 7 of the 9 valuation models that produced a number sit above the price. Our screens treat a discount this large as a strong starting point for a cash-secured put, not as a verdict - the fair value is a model output, and a wide gap can mean the models are missing something the market knows.
There is a wide gap between DDM (15.16) and Graham Growth (358.71). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.
The nightly engine files TOL under Value: positive earnings at a P/E of 18 or less.
Nine valuation models for TOL
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 188.15 | +44% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 159.79 | +23% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 358.71 | +175% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 129.77 | -0% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 187.04 | +43% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 319.05 | +145% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 299.30 | +130% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 15.16 | -88% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 140.29 | +8% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | 72.82 | -44% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 168.00 | +29% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Toll Brothers, Inc. scores 5 of 9 on the Piotroski F-score: a middling result that falls one point short of the Sunday Scan's "6 or more" rule. Some of the nine tests on profitability, leverage and efficiency are failed, so the accounts are worth a look before selling a put on the name. On durability TOL scores 7.0/10 on the GLS Moat - a middle reading; the Scorecard on the Quote page's Financials tab shows which ten-year lines are steady and which are not.
Returns on capital are high - ROIC 12.0%, ROE 16.3%, ROA 9.3% - with debt at 0.35 times equity and a free-cash-flow yield of 9.1%.
The dividend yield is 0.79% with a payout ratio of 8% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Home Building 100%, Land 0% (quarter Q3 FY2026).
Institutional ownership scores 10/10, insider activity 2/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 5 / 9 | ROIC | 12.0% |
|---|---|---|---|
| GLS Moat | 7.0 / 10 | ROE | 16.3% |
| Debt / equity | 0.35 | ROA | 9.3% |
| Free-cash-flow yield | 9.1% | Payout ratio | 8% |
| Institutions | 10 / 10 | Insiders · Congress | 2 · 5 / 10 |
Wheel Score 85: Prime
With a Wheel Score of 85, Toll Brothers, Inc. sits in the Prime band - price, quality and premium all line up for the wheel strategy. The parts: Value 25/25, Health 11/20, Moat 11/15, Premium 20/20, Stability 18/20. A high score is a ranking, not a signal: it says nothing about timing, the earnings date or your position size.
Implied volatility is 36% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is 24,965 contracts across all expiries - enough for the wheel at normal size.
Volume runs at 1.1M shares a day on a market cap of $12.0B, with a beta of 1.30 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 18 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 25 / 25 | 35% margin of safety | |
| Health | 11 / 20 | Piotroski 5/9 | |
| Moat | 11 / 15 | moat 7.0/10 | |
| Premium | 20 / 20 | implied volatility 36% | |
| Stability | 18 / 20 | 1.1M shares/day, $12.0B cap, beta 1.30 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 14 Dec 2026, 59 days away - outside the window of a 30-45-day put sold today.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Residential Construction
The 12 companies below are the closest to Toll Brothers, Inc. by market cap within the Residential Construction industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| NVR NVR, Inc. | 5,940.83 | 6,229.48 | +5% | 39No options | $15.9B |
| LEN-B Lennar Corporation | 76.93 | 90.39 | +15% | 39No options | $18.5B |
| LEN Lennar Corporation | 77.69 | 92.40 | +16% | 79Good | $18.5B |
| PHM PulteGroup, Inc. | 109.35 | 197.70 | +45% | 88Prime | $20.8B |
| IBP Installed Building Products, Inc. | 187.94 | 112.54 | -67% | 57Fair | $5.0B |
| SKY Champion Homes, Inc. | 75.90 | 80.03 | +5% | 76Good | $4.1B |
| CVCO Cavco Industries, Inc. | 535.60 | 530.46 | -1% | 67Good | $4.1B |
| MTH Meritage Homes Corporation | 60.28 | 101.28 | +40% | 80Prime | $3.9B |
| DHI D.R. Horton, Inc. | 139.55 | 298.13 | +53% | 89Prime | $39.0B |
| MHO M/I Homes, Inc. | 126.02 | 176.77 | +29% | 76Good | $3.2B |
| GRBK Green Brick Partners, Inc. | 61.98 | 91.90 | +33% | 79Good | $2.7B |
| KBH KB Home | 43.65 | 62.28 | +30% | 80Prime | $2.7B |
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Start free See the Sunday ScanQuestions about TOL
Is TOL undervalued right now?
By the GLS models, yes: at 130.41 the stock is 35% below the average fair value of 199.69 (data as of 16 Oct 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of TOL and what does it mean?
TOL scores 85 out of 100 (Prime). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for TOL?
199.69 per share as of 16 Oct 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Toll Brothers, Inc. report earnings next?
The next earnings report is due on 14 Dec 2026 (after the close), 59 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does TOL have listed options, and how liquid are they?
Yes. The nightly snapshot found 470 listed contracts with 24,965 open interest across all expiries and implied volatility of 36% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.