Toro Company Earnings Preview

Investors hope Toro Company (NYSE: TTC  ) will top analyst estimates once again after beating predictions by $0.07 in the previous quarter. The company will unveil its latest earnings on Thursday, Feb. 23. Toro designs, manufactures, and markets professional turf maintenance equipment and services turf and agricultural micro-irrigation systems, landscaping equipment, and residential yard and snow-removal products.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Toro Company with three of five analysts rating it hold.
  • Revenue forecasts: On average, analysts predict $402.8 million in revenue this quarter. That would represent a rise of 5.1% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.60 per share. Estimates range from $0.58 to $0.63.

What our community says:
CAPS All Stars are solidly behind the stock, with 97.7% awarding it an "outperform" rating. The greater community agrees with the All Stars, as 93.9% give it a rating of "outperform." Even with a robust four out of five stars, Toro Company's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Toro Company's profit has risen year-over-year by an average of 37.6% over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. For the last two quarters, the company's gross margin has been down year-over-year. Gross margin reflects the total sales revenue retained after costs. Here are Toro Company's reported margins for the last four quarters:

Quarter

Q4

Q3

Q2

Q1

Gross Margin

32.3%

33.5%

33.8%

35.7%

Operating Margin

2.5%

10.9%

14.8%

7.1%

Net Margin

1.4%

7%

9.5%

4.5%

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Earnings estimates provided by Zacks.

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