Taylor Morrison Home Corp (NASDAQ: TMHC) and Toll Brothers (NYSE:TOL) are both cyclical consumer goods & services companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, risk, earnings and dividends.

Institutional and Insider Ownership

80.4% of Toll Brothers shares are held by institutional investors. 8.8% of Toll Brothers shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Taylor Morrison Home Corp and Toll Brothers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Taylor Morrison Home Corp 0 5 1 0 2.17
Toll Brothers 1 6 8 0 2.47

Taylor Morrison Home Corp presently has a consensus target price of $22.20, indicating a potential upside of 0.73%. Toll Brothers has a consensus target price of $39.27, indicating a potential upside of 1.40%. Given Toll Brothers’ stronger consensus rating and higher possible upside, analysts clearly believe Toll Brothers is more favorable than Taylor Morrison Home Corp.

Dividends

Toll Brothers pays an annual dividend of $0.32 per share and has a dividend yield of 0.8%. Taylor Morrison Home Corp does not pay a dividend. Toll Brothers pays out 13.2% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Taylor Morrison Home Corp and Toll Brothers’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Taylor Morrison Home Corp $3.73 billion 0.43 $344.81 million N/A N/A
Toll Brothers $5.41 billion 1.17 $507.09 million $2.43 15.94

Toll Brothers has higher revenue and earnings than Taylor Morrison Home Corp.

Profitability

This table compares Taylor Morrison Home Corp and Toll Brothers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Taylor Morrison Home Corp 6.16% 9.57% 5.34%
Toll Brothers 7.67% 9.71% 4.33%

Summary

Toll Brothers beats Taylor Morrison Home Corp on 12 of the 14 factors compared between the two stocks.

Taylor Morrison Home Corp Company Profile

Taylor Morrison Home Corporation is a homebuilder, which designs, builds and sells single-family detached and attached homes. The Company is also a land developer, with a portfolio of lifestyle and master-planned communities. Its segments include East, which includes Atlanta, Charlotte, North Florida, Raleigh, Southwest Florida and Tampa; Central, which includes Austin, Dallas, and Houston (each of the Dallas and Houston markets include both a Taylor Morrison division and a Darling Homes division); West, which includes Bay Area, Chicago, Denver, Phoenix, Sacramento and Southern California, and Mortgage Operations, which includes Taylor Morrison Home Funding, LLC (TMHF) and Inspired Title Services, LLC (Inspired Title). It operates under the Taylor Morrison and Darling Homes brand names. The Company also provides financial services to customers through its mortgage subsidiary, TMHF, and title insurance and closing settlement services through its title company, Inspired Title.

Toll Brothers Company Profile

Toll Brothers, Inc. is engaged in designing, building, marketing, selling and arranging financing for detached and attached homes in luxury residential communities. The Company operates through two segments: Traditional Home Building and Toll Brothers City Living (City Living). Within the Traditional Home Building segment, it operates in five geographic segments in the United States: the North, consisting of Connecticut, Illinois, Massachusetts, Michigan, Minnesota, New Jersey and New York; the Mid-Atlantic, consisting of Delaware, Maryland, Pennsylvania and Virginia; the South, consisting of Florida, North Carolina and Texas; the West, consisting of Arizona, Colorado, Nevada and Washington, and California. City Living is the Company’s urban development division. Its products include Traditional Home Building Product and City Living Product. Its Traditional Home Building Product includes detached homes, move-up, executive, estate, and active-adult and age-qualified lines of home.

Receive News & Ratings for Taylor Morrison Home Corp Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Taylor Morrison Home Corp and related companies with MarketBeat.com's FREE daily email newsletter.