UPDATE: Keefe, Bruyette & Woods Downgrades Toll Brothers to Market Perform, Raises PT on Valuation

In a report published Wednesday, Keefe, Bruyette & Woods analyst Jade J. Rahmani downgraded the rating on

from Outperform to Market Perform, but raised the price target from $40.00 to $42.00. In the report, Keefe, Bruyette & Woods noted, “Core earnings (ex. gains) were modestly below our estimates on gross margin and SG&A. TOL reduced the top end of its 2014 revenue guidance. Management noted weather had impacted some sales. We increase our price target to $42 from $40 on the roll forward of higher book value, but downgrade to Market Perform on valuation. We moderately decrease our forward estimates on deliveries and gross margin.” Toll Brothers closed on Tuesday at $38.25.