TTC
The Toro Company
$95.91
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 54.4% above fair value
You pay
$95.91
Bear
$49.69
Fair
$62.11
Bull
$74.53
Bear
$49.69
-48.2%
$3.51 × 12x P/E
Fair
$62.11
-35.2%
$3.51 × 15x P/E
Bull
$74.53
-22.3%
$3.51 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
27.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $99.75 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $62.11 per share.
Warnings
Dividend-based valuation: $79.38 (above our primary estimate by 51%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $99.75 (from 11 analysts). Our estimate is 47% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples