- Adjusted EPS: Toro’s adjusted earnings per share (EPS) for the fourth quarter matched estimates at 95 cents, up from 71 cents the previous year.
- Net Sales: Net sales totaled $1.08 billion, an increase of 9.4% year-over-year, slightly below the estimate of $1.09 billion.
- Professional Segment Performance: Professional net sales were $913.9 million, achieving a 10% year-over-year growth but less than the estimated $940.8 million.
- Residential Segment Growth: Residential net sales rose to $155.1 million, exceeding the estimated $143.9 million, thanks largely to a strong mass channel strategy and new product launches.
- Overall EPS Growth: Earnings per share were 87 cents compared to 67 cents the year before.
- Operating Income: Adjusted operating income grew by 18% year-over-year to $117.0 million, though still below the estimated $131.2 million.
- Fiscal 2025 Outlook: Management forecasts net sales growth between 0% to 1% and adjusted diluted EPS between $4.25 to $4.40 for the next fiscal year.
- Key Residential Segment Drivers: Growth was driven by a partnership with Lowe’s and new product lines like the Toro® TimeCutter® and TITAN® mowers.
- Challenges Offset: The company managed to mitigate challenges from decreased demand in snow and ice management products and lawn care in dealer channels.
- Professional Segment Success: Toro successfully increased production of underground construction equipment and golf solutions to meet strong market demand.
- Dealer Inventory Management: Significant progress was made in reducing lawn care product inventories through lower shipments and increased retail sales.
- Analyst Ratings: Current analyst ratings include 2 buy recommendations and 4 holds, with no sell ratings.
Toro Co on Smartkarma
Analysts on Smartkarma, including Value Investors Club, have been closely examining Toro Co (TTC). In a recent report dated Monday, Mar 25, 2024, Value Investors Club presented a bearish perspective on Toro Co. The report highlighted concerns about the company’s involvement in credit extension through quasi-off-balance sheet financing vehicles like Red Iron. Toro Co primarily sells gas-powered outdoor power equipment to professional customers, with Pro sales being their main revenue source. They also cater to residential customers and offer a wide range of products, including mowers, snow equipment, and large machinery for infrastructure markets.
The analysts’ scrutiny of Toro Co focuses on the potential risks associated with their financing strategies. The report underscores the company’s reliance on quasi-off-balance sheet financing as a key point of contention. While Toro Co serves both professional and residential customers with a diverse product portfolio, concerns about their credit extension practices have sparked debate among analysts. Value Investors Club‘s research sheds light on these potential risks and forms part of the ongoing coverage of Toro Co on Smartkarma, providing valuable insights for investors evaluating the company’s prospects.
A look at Toro Co Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 3 | |
| Growth | 3 | |
| Resilience | 3 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 2.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Looking ahead, Toro Co seems to have a mixed outlook based on Smartkarma Smart Scores. With a Value score of 2, the company may not be considered undervalued compared to its peers. However, Toro Co receives moderate scores in Dividend, Growth, Resilience, and Momentum, all rated at 3. This indicates that while the company is offering a decent dividend and showing steady growth and resilience, it may not be showing exceptional performance in these areas compared to other companies.
The Toro Company, known for designing, manufacturing, and marketing turf equipment globally, may face a somewhat stable future. With a diverse range of products including professional turf maintenance equipment, irrigation systems, landscaping tools, and residential yard products, Toro Co operates under well-known trademarks such as Toro, Wheel Horse, Lawn-Boy, Irritrol, and Dingo. Its Smartkarma Smart Scores reflect a company that is moderately positioned in terms of value, dividend, growth, resilience, and momentum, suggesting a balanced overall outlook in the long term.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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