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TMHC vs TOL
Which Stock Would AI Choose? Taylor Morrison Home Corporation (TMHC) vs. Toll Brothers, Inc. (TOL) Stock Comparison
Key Takeaways
- Both companies posted Q2 2024 revenue growth of roughly 6% YoY, with TMHC reporting $1.99 bn and TOL reporting $2.65 bn in home‑building revenue.
- TMHC achieved an adjusted home‑closings gross margin of 23.9% (Q2) versus TOL’s 28.2% adjusted home‑sales gross margin, reflecting TOL’s stronger spec‑home mix.
- Both firms raised full‑year guidance; TMHC now targets $10.6 bn–$11.0 bn FY 2024 revenue, while TOL expects ≈$14 bn FY 2024 earnings per share.
- Liquidity remains robust: TMHC holds ~$1.3 bn cash and $1.1 bn revolving credit capacity; TOL reports $1.0 bn cash and $1.7 bn undrawn revolving credit.
- Both companies continue aggressive share‑repurchase programs and dividend hikes, underscoring shareholder‑friendly capital allocation.
Introduction
Investors seeking exposure to the U.S. residential construction sector often compare the two industry leaders, TMHC (Taylor Morrison Home Corporation) and TOL (Toll Brothers, Inc.). Both firms operate nationwide, target mid‑to‑luxury buyers, and have reported solid Q2 2024 results amid a still‑tight housing supply and gradually easing mortgage rates. This comparison is relevant for growth‑oriented traders, income‑focused investors, and analysts weighing relative valuation, margin stability, and balance‑sheet strength.
TMHC Overview and Recent Performance
TMHC, a leading national land developer and homebuilder, announced its Q2 2024 earnings on July 24 2024. The company delivered 3,200 homes at an average price of $600 k, generating home‑closings revenue of $1.92 bn (down 4% YoY) and total revenue of $1.99 bn (down 3.4%). Adjusted home‑closings gross margin held at 23.9%, slightly below guidance but comparable to the prior year’s 24.2% margin. SG&A (selling, general and administrative expenses) as a percent of revenue rose modestly to 10.2%, reflecting higher marketing spend on new community openings. Net sales orders grew 3% YoY to 3,111, while the net backlog stood at 6,256 homes worth $4.20 bn. The company’s balance sheet showed $1.3 bn liquidity and a net home‑building debt‑to‑capital ratio of 22.8%, up from 15.4% a year earlier due to higher cash utilization for share buybacks ($105 m) and land acquisition ($611 m). Management raised FY 2024 revenue guidance to $10.6 bn–$11.0 bn and reaffirmed its 2024 EPS outlook of $1.86 – $2.12 (adjusted).
TOL Overview and Recent Performance
TOL, the nation’s leading builder of luxury homes, reported its FY 2024 Q2 results on May 21 2024. The company delivered 2,641 homes at an average price of $1.0 m, producing home‑sales revenue of $2.65 bn (up 6% YoY) and total revenue of $2.84 bn. Adjusted home‑sales gross margin reached 28.2%, outperforming guidance by 60 bps, while SG&A fell to 9.0% of revenue (70 bps better than forecast). Net signed contract value surged 29% YoY to $2.94 bn, and backlog declined modestly to $7.38 bn (down 12%). Cash holdings were $1.03 bn with $1.7 bn undrawn under a $1.9 bn revolving facility; net debt‑to‑capital stood at 18.7%. The firm repurchased $181 m of common stock and increased its quarterly dividend by 10%. Full‑year guidance was upgraded to FY 2024 earnings per share of approximately $14 and revenue near $10.23 bn, driven by expectations of 10,400‑10,800 deliveries at $960 k–$970 k average price.
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Head‑to‑Head Comparison
- Business Model: TMHC emphasizes a diversified portfolio of residential, rental, and financial‑services segments, while TOL focuses on luxury and upscale homes with a growing spec‑home component.
- Growth Drivers: Both benefit from low resale inventory and strong buyer demand. TMHC is expanding its land bank (≈80,677 lots) and increasing price‑point flexibility; TOL leverages spec‑home production (~54% of Q2 deliveries) to capture faster‑move‑in buyers.
- Margin Profile: Adjusted gross margins are 23.9% for TMHC vs. 28.2% for TOL. The gap reflects TOL’s higher price mix and efficient spec‑home cost structure, though TMHC maintains a tighter cost base with lower SG&A as a share of revenue.
- Risk Factors: TMHC faces exposure to financing‑service margins and land‑cost volatility; TOL is more sensitive to luxury‑buyer sentiment and potential spec‑home inventory adjustments.
- Liquidity & Leverage: Both have ample cash and revolving credit. TMHC shows a slightly higher net debt‑to‑capital (22.8%) versus TOL (18.7%), indicating modestly higher leverage at TMHC.
- Shareholder Returns: Both companies are active in share repurchases and have raised dividends in 2024, signalling confidence in free cash flow generation.
Tickeron AI Verdict
Based on the most recent data, Tickeron’s AI models currently assign a modest edge to TOL. The higher adjusted gross margin, stronger spec‑home pipeline, and upgraded FY 2024 earnings guidance suggest a higher probability of outperformance in the near term, especially if mortgage rates continue to ease. However, the advantage is not decisive; TMHC’s diversified land position and lower leverage provide a solid defensive profile. Hence, the AI verdict leans toward TOL as the preferable pick, with a probability weighting that reflects its superior margin trajectory while acknowledging the upside potential in TMHC if its land‑banking strategy translates into stronger price‑point expansion.
Disclaimer
“The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.” Disclaimers and Limitations
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is TMHC is a StrongBuy and TOL is a Hold.
Long-Term Analysis
It is best to consider a long-term outlook for a ticker by using Fundamental Analysis (FA) ratings. The rating of 1 to 100, where 1 is best and 100 is worst, is divided into thirds. The first third (a green rating of 1-33) indicates that the ticker is undervalued; the second third (a grey number between 34 and 66) means that the ticker is valued fairly; and the last third (red number of 67 to 100) reflects that the ticker is undervalued. We use an FA Score to show how many ratings show the ticker to be undervalued (green) or overvalued (red).
TMHC’s FA Score shows that 2 FA rating(s) are green whileTOL’s FA Score has 1 green FA rating(s).
- TMHC’s FA Score: 2 green, 3 red.
- TOL’s FA Score: 1 green, 4 red.
Short-Term Analysis
It is best to consider a short-term outlook for a ticker by using Technical Analysis (TA) indicators. We use Odds of Success as the percentage of outcomes which confirm successful trade signals in the past.
If the Odds of Success (the likelihood of the continuation of a trend) for each indicator are greater than 50%, then the generated signal is confirmed. A green percentage from 90% to 51% indicates that the ticker is in a bullish trend. A red percentage from 90% - 51% indicates that the ticker is in a bearish trend. All grey percentages are below 50% and are considered not to confirm the trend signal.
TMHC’s TA Score shows that 5 TA indicator(s) are bullish while TOL’s TA Score has 5 bullish TA indicator(s).
- TMHC’s TA Score: 5 bullish, 5 bearish.
- TOL’s TA Score: 5 bullish, 6 bearish.
Price Growth
TMHC (@Homebuilding) experienced а +0.08% price change this week, while TOL (@Homebuilding) price change was +1.08% for the same time period.
The average weekly price growth across all stocks in the @Homebuilding industry was +5.11%. For the same industry, the average monthly price growth was +8.24%, and the average quarterly price growth was -2.40%.
Reported Earning Dates
TMHC is expected to report earnings on Jul 29, 2026.
TOL is expected to report earnings on Aug 25, 2026.
Industries' Descriptions
@Homebuilding (+5.11% weekly)Homebuilding includes companies residential home construction companies, renovators and repair firms. The companies may be building single-family or multifamily homes, condominiums or mobile homes. Over the five years to 2019, the Home Builders industry is estimated to have grown at an annualized rate of 2.5% to reach $89.4 billion, (including expected growth of 2.6% in 2019), according to a study by IbisWorld. After having suffered one of its worst crises a decade ago during the last macroeconomic recession–which had much of its origins in U.S. real estate – the homebuilding industry has been recovering steadily so far. Higher disposable incomes and improving economic activity have bolstered consumers’ purchases of homes. While revenue of the Home Builders industry remains well below its prerecession high, demand growth estimates show promise.
| TMHC | TOL | TMHC / TOL | |
| Capitalization | 6.59B | 13B | 51% |
| EBITDA | 1.03B | 1.7B | 61% |
| Gain YTD | 21.624 | 3.102 | 697% |
| P/E Ratio | 10.67 | 10.55 | 101% |
| Revenue | 7.61B | 11B | 69% |
| Total Cash | 653M | 1.11B | 59% |
| Total Debt | 2.42B | 2.92B | 83% |
TMHC | TOL | ||
|---|---|---|---|
OUTLOOK RATING 1..100 | 25 | 63 | |
VALUATION overvalued / fair valued / undervalued 1..100 | 44 Fair valued | 63 Fair valued | |
PROFIT vs RISK RATING 1..100 | 22 | 45 | |
SMR RATING 1..100 | 69 | 55 | |
PRICE GROWTH RATING 1..100 | 40 | 47 | |
P/E GROWTH RATING 1..100 | 17 | 28 | |
SEASONALITY SCORE 1..100 | 50 | 50 |
Tickeron ratings are formulated such that a rating of 1 designates the most successful stocks in a given industry, while a rating of 100 points to the least successful stocks for that industry.
TMHC's Valuation (44) in the Homebuilding industry is in the same range as TOL (63). This means that TMHC’s stock grew similarly to TOL’s over the last 12 months.
TMHC's Profit vs Risk Rating (22) in the Homebuilding industry is in the same range as TOL (45). This means that TMHC’s stock grew similarly to TOL’s over the last 12 months.
TOL's SMR Rating (55) in the Homebuilding industry is in the same range as TMHC (69). This means that TOL’s stock grew similarly to TMHC’s over the last 12 months.
TMHC's Price Growth Rating (40) in the Homebuilding industry is in the same range as TOL (47). This means that TMHC’s stock grew similarly to TOL’s over the last 12 months.
TMHC's P/E Growth Rating (17) in the Homebuilding industry is in the same range as TOL (28). This means that TMHC’s stock grew similarly to TOL’s over the last 12 months.
| TMHC | TOL | |
|---|---|---|
| RSI ODDS (%) | 1 day ago 64% | 1 day ago 77% |
| Stochastic ODDS (%) | 1 day ago 65% | 1 day ago 54% |
| Momentum ODDS (%) | 1 day ago 73% | 1 day ago 66% |
| MACD ODDS (%) | 1 day ago 63% | 1 day ago 63% |
| TrendWeek ODDS (%) | 1 day ago 72% | 1 day ago 73% |
| TrendMonth ODDS (%) | 1 day ago 71% | 1 day ago 69% |
| Advances ODDS (%) | 16 days ago 72% | 16 days ago 72% |
| Declines ODDS (%) | 14 days ago 62% | 4 days ago 60% |
| BollingerBands ODDS (%) | 1 day ago 60% | 1 day ago 58% |
| Aroon ODDS (%) | 1 day ago 64% | 1 day ago 63% |
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TMHC and
Correlation & Price change
A.I.dvisor indicates that over the last year, TMHC has been closely correlated with MTH. These tickers have moved in lockstep 82% of the time. This A.I.-generated data suggests there is a high statistical probability that if TMHC jumps, then MTH could also see price increases.
| Ticker / NAME | Correlation To TMHC | 1D Price Change % | ||
|---|---|---|---|---|
| TMHC | 100% | -0.06% | ||
| MTH - TMHC | 82% Closely correlated | -2.12% | ||
| LEN - TMHC | 82% Closely correlated | -2.93% | ||
| MHO - TMHC | 81% Closely correlated | -2.40% | ||
| KBH - TMHC | 80% Closely correlated | -2.47% | ||
| GRBK - TMHC | 74% Closely correlated | -2.02% | ||
More | ||||
TOL and
Correlation & Price change
A.I.dvisor indicates that over the last year, TOL has been closely correlated with PHM. These tickers have moved in lockstep 89% of the time. This A.I.-generated data suggests there is a high statistical probability that if TOL jumps, then PHM could also see price increases.