Is Toll Brothers, Inc. overvalued or undervalued?

As of 2 July 2025, the valuation grade for Toll Brothers, Inc. has moved from expensive to fair, indicating a more favorable assessment of its market position. The company appears to be fairly valued based on its current metrics. Key ratios include a P/E ratio of 8, an EV to EBITDA of 7.22, and a Price to Book Value of 1.43.
In comparison to peers, Toll Brothers has a P/E ratio of 11.10 against Taylor Morrison Home Corp.'s attractive P/E of 10.67 and M.D.C. Holdings, Inc.'s fair P/E of 16.34. Notably, while Toll Brothers has shown strong performance over the long term with a 3-year return of 220.29%, it has underperformed the S&P 500 over the past year with a return of -6.86% compared to the S&P's 17.14%.