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Homebuilder Toll Brothers $TOL reported better than expected fiscal third-quarter earnings before the market opened Tuesday. However $TOL fell after thee average price of homes fell over the year. 

Net signed contracts rose 25% to $1.81Bil, while deliveries were up 26% to 1,899 units during the quarter. However the average price of homes fell to $791,400, compared to $842,700 a year earlier, mostly due to an as expected change in the mix.

Earnings  Net income of US$148.6mln, or 87 US cents per share beating expectations of 69 US cents a share. Earnings were up from US$105.5mln, or 61 US cents a share a year earlier. Revenue rose to US$1.50 billion, up from US$1.27 billion a year earlier, just under the consensus forecast of US$1.51bn.

Reaction Toll Brothers Inc NYSE: $TOL Pre-market:37.10 -1.16 (-3.03%)

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The $TOL backlog in 3Q17 was $5.31Bil, up 21%YoY. The average price of homes in backlog was $845,100, compared to $844,300 a year ago.

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Guidance

Toll Brothers expects to deliver between 7,000 and 7,300 homes in fiscal 2017, up from earlier guidance of 6,950 to 7,450 units, at an average price of $800,000 to $825,000 a home. This translates to projected revenues of $5.6-6.0Bil in FY17, vs $5.17Bil in FY16. Deliveries in 4Q17 are anticipated between 2,275 and 2,575 unit

Source: Toll Brothers, AlphaStreet

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