Home Builder Toll Brothers Swings to 4Q Profit, Helped By Tax Benefit

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Toll Brothers (NYSE:TOL) said Thursday it swung to a profit in its fiscal fourth quarter, but the home builder’s net contracts slumped 27%.The luxury home builder said it earned $50.5 million, or 30 cents a share, compared with a loss of $111.4 million, or 68 cents a share, a year earlier.Revenue slid 17% to $402.6 million, but managed to exceed the Street’s view of $394 million. Gross margins leaped from 0.8% to 13.9%.However, Toll Brothers said its net contracts signed slid 27% to 558 units amid weak demand.“Even though the unemployment rate among our buyers is about half that of the national average, many of our clients remain on the sidelines waiting for clearer signs that the economy is on the road to recovery,” Toll CEO Douglas Yearley, Jr., said in a statement.Shareholders were initially disappointed by the results, sending Toll’s stock down more than 1%. The stock rebounded along with other home builders like KB Home (NYSE:KBH) after the National Association of Realtors said pending sales of existing homes unexpectedly soared by 10.4% in October from September.Toll’s shares were up 3.41% to $19.09 in late Thursday morning trading, trimming its year-to-date loss to 1.9%.

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