UPDATE: Stifel Nicolaus Upgrades Toll Brothers to Hold on Valuation, Outlook
Stifel Nicolaus raised rating on Toll Brothers (NYSE: TOL) from Sell to Hold.
Stifel Nicolaus noted, "[TOL's] strong 2012 return (+58.3% vs. the S&P 500's +13.4%) was less than half that of the +123% homebuilder average. In our view the sizable valuation premium that it held a year ago for its top quality management, unique “luxury segment” focus, and robust balance sheet has been meaningfully reduced. On balance we still see the stock as richly valued, but given its sector-leading land supply (measured in “years supply”), solid margins, and widely held respect for the “franchise” we believe it has some room to maintain its current premium, especially in a rising home price scenario."
Toll Brothers closed at $33.48 on Wednesday.
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