Toll Sounds Alarm Bells

It's here folks... TOL, the leader in McMansions, and yes, the TOL where the CEO just cashed out, freaked the market out today with warnings of future softness and nervous buyers. POP! The last sucker in went in. No more suckers left.. - Keith

Toll Brothers sent shivers through the real estate market Tuesday, reporting solid sales in its just-completed fourth quarter but tempering its forecast for 2006.

The mansion vendor posted fourth-quarter homebuilding revenue of $2.01 billion, up 39% from a year ago on a 23% jump in home sales to 2,957. Analysts were forecasting revenue of $1.94 billion in the latest period. Toll said its backlog was $6.01 billion at Oct. 31, 2005, up 36% from a year ago.

Despite the record numbers, Toll was uncharacteristically restrained in its assessment of 2006, saying regulatory pressures, nervous buyers and pricing issues could weigh on earnings growth. The company expects to deliver 9,500 to 10,200 homes in fiscal 2006, down from its previous estimate of 10,200 to 10,600.