Toll: Favor the chocolate chips, not the stockAaron Pressman
Luxury homebuilder Toll Brothers (TOL) is having an awful year in the stock market as the designated punching bag for real estate bubble watchers. After tripling in price from late 2004 to July 2005 and peaking at almost $59, the shares have tumbled below $30 lately. Unfortunate for shareholders but less so for the CEO, Robert Toll, who sold 2 million shares last summer around $50. As he tells Barron’s, "The reason I sold it is that we hit an all-time high and we were trading at a 40% to 50% premium to our peers." That’s a refreshing burst of honesty from an overpaid CEO – at least he didn’t pin the blame on estate planning needs. And to be fair, he still owned 18.8 million shares as of a December 21 securities filing. But is the current price a great buying opportunity, as Barron’s suggests?
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