Toll Bros. CFO Can't See $4B Inventory
The CFO of Toll Brothers had this comment. "'Housing demand is very strong across most of the country,' said Joel Rassman, CFO for Toll Brothers. Rassman said his company is selling every home it can get local permitting authorities to approve."
"We don't see any significant inventory." Well, what's this?
8 Comments:
John,
Thanks!
Repeat after me. "Truth is ignorance." Remember George Orwell and his novel 1984. Chomsky, even a leftist wrote a book called "Manufacturing consent in America." He's wright. Even if you shout facts like these in their faces, they keep on denying and think you are probably a pinko or anti-american.
It's anecdotal, but noticed way more internet ads for TOL homes on online sites like Barron's and WSJ Online of late. Certainly not the mark of a company selling all of the inventory it has on hand as fast as it can.
Noticed in their last quarterly report that they expect "inventories to build" in 2005 as they deliver more gaudy, foamboard-clad McMansions....but I don't buy the reasoning. And apparently, neither does the TOL executive corp. given their insider activity.
ben, what ratios are good to look at
on the balance sheet?. i saw the inventory rose but also sales.
To be fair, I'm not sure the higher inventory numbers indicate a massive build up in inventories. Higher sales and higher inventories pan out, turnover is just the same. If sales do drop, however, there is definitely a much higher level of inventory to be sold.
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(what ratios are good to look at
on the balance sheet?. i saw the inventory rose but also sales)
It's the size, the numbers. Billions and billions every year. And if you check any major HB, it's the same. They were accumulating inventory like this boom would go on for another decade.
Most of it is land. Some of thes co.s have 100k lots or more.
just read the new homes sales article in the wsj... no mention of a drop of 9.3% in home prices... just increase of 12.2% in sales... amazing...
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