TOL ==> The Summer Solstice Winner

[New-born baby]

Update

Better take a close look at that chart, Jim, et al. That's an inverted head and shoulders. This is the time to move into the stock. Lots of upside potential now. What are those calls selling for? The JUN $35 Call sells for a mere $1.45, and the $40 call will set you back just 45 cents. I tell you I think the in the money $35 June Call is the way to go, because as TOL rises the delta is going to approach 1. It will move almost penny for penny with the stock . . . .

This is a little later than expected, but Mr. Market has "got a winnah, got a winnah!"

I was reading MM's latest post on TOL, and saw this post I put on the board on FEB 21. Let's check out how this call worked out. You see by the chart that TOL made the $35 target, and actually double topped out at $36. So the play made money.

[Runner]

NB, I would not know an option play if it slapped me in the face…LOl

[IIC]

I never liked TOL...I heard that news and I knew it was coming because it was listed in last weekend's Barron's(The call...not what they would say)...Now I'd say TOL may have topped out for possibly the next 8-10 years.

I was looking at Ernie's site today...There are some dogs in there. I remember Ernie asking if he should end the streak and start over...But I don't remember him saying what he ended up deciding to do???

My recommendation is to let the streak run to 100 and call it a decade...IIC

[mrmarket]

PE of 5.5..forward PE of 6.5..

I don't understand how adjusting earnings estimates down by a few cents a share necessitates a PE ratio of 5.5. This stock is a screaming value.




=========================

Toll Brothers 2Q Profit Up 3 Percent
Tuesday May 23, 9:45 am ET
Toll Brothers 2Q Profit Up 3 Percent, but Warns of Lower Full-Year Outlook

HORSHAM, Pa. (AP) -- Luxury home builder Toll Brothers Inc. said Tuesday its fiscal second-quarter profit edged up 3 percent, but the company warned that excess inventory and weak consumer confidence will crimp earnings for the year.
For the quarter ended April 30, net income was $174.9 million, or $1.06 per share, compared with $170.1 million, or $1 per share, in the previous second quarter.

Revenue climbed 17 percent to $1.44 billion, with sales of traditional homes rising to $1.4 billion from $1.23 billion.

On average, analysts surveyed by Thomson Financial had forecast income of $1.03 per share and revenue of $1.47 billion.

Toll Brothers, which operates in 21 states nationwide, said it now expects fiscal 2006 earnings per share of $4.69 to $5.16, bracketing the current Thomson consensus estimate of $4.83 per share. The company previously forecast a per-share profit range of $4.77 to $5.25 but earlier this month reduced its estimated home deliveries because of slowing growth rates. The company also attributed its lower range to increased material and labor costs and higher write-downs in the second quarter, a majority of which resulted from continuing weakness in the metro Detroit market.

Robert I. Toll, chairman and chief executive officer, said in a statement, "Demand, while obviously diminished, has not disappeared. We believe many customers currently feel a lack of urgency to purchase due to their uncertainty over the direction of home prices. This has contributed to keeping many potential buyers on the sidelines."

Toll estimated that once excess inventory is absorbed, then demand should exceed supply.

[New-born baby]

Inverted

I just looked at the weekly chart on TOL, and it looks like it is working on an inverted head and shoulders pattern. Right now the head has been partially formed. Could make for a bullish chart in about six-twelve weeks . . . .

[Jim Smith]

Inverted H/S pattern for TOL? Seems like a stretch to me

[DSteckler]

I don't see an IH&S pattern forming on the weekly.

[New-born baby]

I don't see an IH&S pattern forming on the weekly.

Look at this and you'll see what I mean. Remember, I said "possible."

http://img215.imageshack.us/img215/7578/chart17ur.gif

[DSteckler]

The volume characteristics don't match a IH&S, even if a right shoulder does form.

[jiesen]

Housing news (finally something good?)

http://biz.yahoo.com/ap/060524/economy.html?.v=7

Sales of New Homes Jump Unexpectedly

Wednesday May 24, 10:20 am ET
By Martin Crutsinger, AP Economics Writer

Sales of New Homes Jump, Show Unexpected Strength in April Amid Rising Mortgage Rates WASHINGTON (AP) -- Sales of new homes rose unexpectedly in April to the fastest pace this year as the housing sector showed resilience in the face of rising mortgage rates. But the price of homes sold last month fell and the level of unsold homes rose to a record high.

The Commerce Department reported that sales of new single-family homes increased by 4.9 percent last month to a seasonally adjusted annual rate of 1.198 million units, the highest rate since last December. The pace of activity caught economists by surprise. They had been expecting a decline in sales, reflecting the fact that mortgage rates have been climbing in recent weeks and now stand at the highest level in nearly four years.

In other economic news, orders to U.S. factories for big-ticket manufactured goods fell in April by the largest amount in three months as aircraft orders plunged and demand for computers and other electronic products dropped by the largest amount in nearly six years.

The Commerce Department reported that demand for airplanes, appliances and other durable goods decreased by 4.8 percent last month, much larger than Wall Street had been expecting. Orders had posted strong gains of 6.6 percent in March and 3.6 percent in February.

The unexpected jump in April home sales was not likely to change the overall view that the booming housing industry is beginning to cool off after setting sales records for five straight years.

Even with the increase in the April sales pace, the median price of a new home sold in April dropped by 7.3 percent from the March level to $238,500. That represented a 0.9 percent increase over the $236,300 median sales price in April 2005, far below the double-digit price gains sellers had been enjoying during the recent sales boom.

The backlog of unsold homes rose by 2.4 percent to a new record of 565,000 homes on the market at the end of April. At the April sales pace, it would take 5.8 months to deplete that backlog.

Economists believe the slowdown in housing will be gradual as long as inflation pressures remain moderate enough to allow the Federal Reserve to soon take a pause in its two-year campaign to push interest rates higher.
A nationwide survey by mortgage giant Freddie Mac showed that rates on 30-year mortgages climbed to 6.60 percent last week, the highest level since late June 2002.

For April, home sales were strong in all parts of the country except the Midwest, where sales fell by 1.1 percent, the second straight monthly declines. Sales were up 8.2 percent in the Northeast, reflecting a rebound after a drop of 7.6 percent in March. Sales were up 7.8 percent in the South and 2 percent in the West.

The April setback in durable goods orders was the largest since a 7.6 percent drop in January. It reflected a 32.2 percent falloff in demand for commercial aircraft after big gains in previous months and a 10.4 percent decrease in orders for computers and other electronic products. It was the biggest decline in this category since July 2000.

While the overall economy is expected to slow in the current quarter, the size of the drop in durable goods orders caught analysts by surprise. They had been expecting a smaller -- 0.5 percent -- pullback following strong gains in previous months.

"Large declines in communications, aerospace and defense equipment industries account for the poor showing in April, but a correction is understandable because these same three industries posted exceptionally strong growth in February and March," said Daniel J. Meckstroth, chief economist for the Manufacturers Alliance/MAPI.

U.S. manufacturing companies, the hardest hit sector in the 2001 recession, are expected to continue posting sizable gains this year, driven by efforts to rebuild lean inventories and continued strong business investment.

Demand in the transportation sector fell by 12.7 percent last month , reflecting a 1.6 percent drop in orders for motor vehicles and parts and a 32.2 percent fall in demand for commercial aircraft, a category that had posted gains of 67.7 percent in March and 72 percent in February.

Demand for military aircraft fell by 24.4 percent in April following a small 0.7 percent increase in March.

Excluding the often volatile transportation category, new orders dropped by 1.1 percent following a 3.5 percent increase in March and a 1.2 percent fall in February.

[mrmarket]

Looooook!!!

AP
Toll Sees Rebound of Housing Market
Thursday June 8, 4:05 pm ET
By Deborah Yao, AP Business Writer
Robert Toll, CEO of Toll Brothers, Says Strong Economy Will Spark Housing Market Rebound

PHILADELPHIA (AP) -- A strong economy will spark a housing market rebound after excess inventory from speculators is shaken out, perhaps very soon, the chief executive of the nation's largest luxury home builder said Thursday.
At a meeting with analysts in New York, Robert Toll of Toll Brothers Inc. said pent-up demand will drive the housing market after the current housing slowdown passes. Demand will be driven by buyers who are biding their time waiting for better incentives or lower prices.

Once they see growth in home prices start to accelerate again, they will come back, he said.

"The next great story is pent-up demand," he said. "Once the natural balance is restored in the market, you're going to see prices go up again. Prices are going to go up quite a bit."

Toll based his optimism on the strength of the economy, but cautioned that it's contingent on the Federal Reserve keeping it healthy.

"Right now we've got a pretty great economy out there," he said. "Jobs are growing every day. Sooner or later, it will back itself into homes."

Toll also said mortgage rates -- currently at an average 6.67 percent for a 30-year fixed home loan -- aren't a major factor in the housing slowdown, since they still hover near four-decade lows.

"We did business at 8.5 (percent) and it was fabulous," he said. "Now it's 6.5."

Toll believes the second-home market will stay particularly robust as Baby Boomers look to move to Sun Belt states or urban centers with rich culture and entertainment.

Horsham, Pa.-based Toll Brothers said it could more than double sales to 20,000 homes a year by boosting its market share to 3 percent in cities where it already has a presence.

The company said it holds a 1.4 percent share in the Midwest and 1.1 percent in the West. In the Northeast, market share is 5.6 percent. In the South, it's 3.3 percent.

But even as Toll Brothers expands, its stock price has been pummeled. Shares of other home builders have been hammered as well as the housing slowdown took hold.

The company said the low valuation could spark acquisitions in the industry.

When asked by an analyst whether the home builder would consider a buyout bid from management, Toll said he would. While management could have done it when shares were lower, he said they didn't because it meant they would have to take on considerable debt, which is risky.

"We haven't done it when we had greater opportunity," he said. "That doesn't mean we wouldn't do it now."

In the meantime, Toll Brothers is considering a small acquisition in the Northeast, he said.

http://www.tollbrothers.com

[DSteckler]

I have my doubts as to it being "very soon."

[Jim Smith]

TOL......this one might not work

Mr. Market, why not come out and break the winning streak...This TOL doesn't not look good at all. Streaks are meant to be broken.

[mrmarket]

Mr. Market, why not come out and break the winning streak...This TOL doesn't not look good at all. Streaks are meant to be broken.

Why would I sell a stock with growing earnings and revenues and a trailing P/E of 5.3 and a forward PE of 6.6??? There is no downside risk to owning this company.

[Runner]

Tol looks interesting to me around 24-18 range