Real Estate Bubble - Toll Brothers Lowers Forcast For Second Time this Year
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Toll Brothers, a leading builder of luxury homes throughout the United States, has lowered forcasts for second time for 2006. This does not bode well for the building industry, especially builders that focus on the top end.
Toll Brothers, based in Horsham, Pa., now says it will deliver only between 9,200 and 9,900 new homes in the current fiscal year, which ends on October 31. This is down from the luxury home builder’s earlier estimate of 9,500 to 10,200 new homes. Of course, that prior estimate was itself lowered from an original forecast of 10,200 to 10,600 new homes in 2006.
Merrill Lynch analysts immediately downgraded their recommendation on Toll Brothers’ stock from “buy” to “neutral.”
“Selling homes this first quarter was certainly more difficult than one year ago,” said CEO Toll. He noted that “we experienced softening demand, to varying degrees, in a number of markets and continue to be constrained by long delivery times at many of our communities.” via USNews.com
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