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Toll BrothersLTS:0LFS -2.57%92 Forward Rate of Return (Yacktman) % is 26.61% as of Apr. 2026, which is 1% above its 10-year median of 26.30. GuruFocus rates LTS:0LFS with a GF Score™ of 92/100 and a GF Value™ of $135.68 (Fairly Valued). The stock has 1 warning sign investors should review. Among 72 Homebuilding & Construction companies, Toll Brothers ranks better than 93.06% on this metric.
Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Toll Brothers's forward rate of return for was 26.61%.
The historical rank and industry rank for Toll Brothers's Forward Rate of Return (Yacktman) % or its related term are showing as below:
LTS:0LFS'
s Forward Rate of Return (Yacktman) % Range Over the Past 10 Years
Min: -1.04 Med: 26.3 Max: 34.11
Current: 26.58
During the past 13 years, Toll Brothers's highest Forward Rate of Return was 34.11. The lowest was -1.04. And the median was 26.30.
LTS:0LFS's Forward Rate of Return (Yacktman) % is ranked better than 93.06% of 72
companies
in the Homebuilding & Construction industry
Industry Median: 3.945
vs LTS:0LFS: 26.58
Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Toll Brothers (LTS:0LFS) Forward Rate of Return (Yacktman) % Explanation
Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.
Be Aware
In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.
Toll Brothers Forward Rate of Return (Yacktman) % Related Terms
Toll Brothers Forward Rate of Return (Yacktman) % Historical Data
* Premium members only.
The historical data trend for Toll Brothers's Forward Rate of Return (Yacktman) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Toll Brothers Forward Rate of Return (Yacktman) % Chart
LTS:0LFS vs NVR, LEN, TMHC: Forward Rate of Return (Yacktman) % Comparison
For the Residential Construction subindustry, Toll Brothers's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Toll Brothers Forward Rate of Return (Yacktman) % vs Homebuilding & Construction Industry
For the Homebuilding & Construction industry and Consumer Cyclical sector, Toll Brothers's Forward Rate of Return (Yacktman) % distribution charts can be found below:
* The bar in red indicates where Toll Brothers's Forward Rate of Return (Yacktman) % falls into.
Toll Brothers Forward Rate of Return (Yacktman) % Calculation
Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
Toll Brothers's Forward Rate of Return of Apr. 2026 is
Forward Rate of Return
=
Normalized Free Cash Flow
/
Price
+
5-Year EBITDA Growth Rate
=
9.3992381
/
141.85
+
0.2
=
26.63 %
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
What does a Forward Rate of Return (Yacktman) % of 26.61% mean?
Toll Brothers (LTS:0LFS) has a Forward Rate of Return (Yacktman) % of 26.61% as of Apr. 2026. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Toll Brothers and its competitors. This is near median its historical median of 26.30. According to the industry distribution chart, Toll Brothers ranks #5 out of 72 companies in the Homebuilding & Construction industry, placing it in the top 6.9%.
Is Toll Brothers' Forward Rate of Return (Yacktman) % too high?
Toll Brothers' current Forward Rate of Return (Yacktman) % of 26.61% is near median its 10-year median of 26.30. The Homebuilding & Construction industry median Forward Rate of Return (Yacktman) % is 3.95. Toll Brothers' value of 26.61% is 574.5% above this industry median. Based on the distribution chart, Toll Brothers ranks #5 out of 72 companies in the Homebuilding & Construction industry, which is in the top quartile — a strong position relative to peers. Overall, Toll Brothers has a GF Score™ of 92/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Toll Brothers' Forward Rate of Return (Yacktman) % compare to NVR and LEN?
According to the Homebuilding & Construction industry distribution chart, Toll Brothers ranks #5 out of 72 companies for Forward Rate of Return (Yacktman) %. This places Toll Brothers in the top 7% of its industry — outperforming the majority of peers. The industry median Forward Rate of Return (Yacktman) % is 3.95. Toll Brothers' value of 26.61% is 574.5% above this benchmark. While the company's 10-year median is 26.30 vs. the industry median of 3.95, Toll Brothers has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Forward Rate of Return (Yacktman) % for a Homebuilding & Construction company?
The median Forward Rate of Return (Yacktman) % among Homebuilding & Construction companies is 3.95, based on 72 companies in the industry. Companies in the top quartile (top 25%) have a Forward Rate of Return (Yacktman) % significantly above this median, while those in the bottom quartile fall well below. However, Forward Rate of Return (Yacktman) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Toll Brothers's current Forward Rate of Return (Yacktman) % of 26.61% is 574.5% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Forward Rate of Return (Yacktman) % mean?
A high Forward Rate of Return (Yacktman) % can signal that a stock is expensive relative to its fundamentals. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Toll Brothers and its competitors. For the Homebuilding & Construction industry, the median Forward Rate of Return (Yacktman) % is 3.95 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Toll Brothers's current Forward Rate of Return (Yacktman) % is 26.61%, which is near median its own 10-year median of 26.30. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Toll Brothers stock overvalued right now?
Based on GuruFocus' analysis, Toll Brothers (LTS:0LFS) is currently considered Fairly Valued. The stock's GF Value™ is $135.68, compared to a current price of $142.27 — trading 4.9% above its estimated fair value. The current Forward Rate of Return (Yacktman) % is 26.61%, which is near median its 10-year median of 26.30 and 574.5% above the Homebuilding & Construction industry median of 3.95. Toll Brothers' overall GF Score™ is 92/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Forward Rate of Return (Yacktman) % calculated?
Forward Rate of Return (Yacktman) % is calculated from a company's financial statements. For Toll Brothers (LTS:0LFS), the current Forward Rate of Return (Yacktman) % is 26.61% as of Apr. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Toll Brothers (LTS:0LFS) Overvalued in 2026?
Based on GuruFocus' analysis, Toll Brothers stock appears to be overvalued.
The current stock price of $142.27 is trading 4.9% above its estimated GF Value™ of $135.68.
GuruFocus considers Toll Brothers to be Fairly Valued.
Key valuation signals for LTS:0LFS:
Forward Rate of Return (Yacktman) %: 26.61% (near median its 10-year median of 26.30)
GF Value™: $135.68 vs. price of $142.27 (4.9% above fair value)
Industry Position: 574.5% above the Homebuilding & Construction median (#5 of 72)
No single metric tells the full story. See the LTS:0LFS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Toll Brothers is the leading luxury homebuilder in the United States with an average sale price well above public competitors'. The company operates in over 60 markets across 24 states and caters to move-up, active-adult, and second-homebuyers. Toll Brothers consistently ranks as a top 10 builder within the US according to total home closings. Traditional homebuilding operations represent most of the company's revenue. Toll Brothers also builds luxury for-sale and for-rent properties in urban centers across the US It has its headquarters in Horsham, Pennsylvania.
92GF Score
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Forward Rate of Return (Yacktman) % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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