Our Toll Brothers report is updated and the stock is rated (lower) Strong Buy. I was disappointed that the earnings were down modestly in its latest report and that the number of homes delivered was down 3%. However, this is basically a timing issue. Toll Brothers’ backlog of houses that it has contracted to deliver and that are under construction is up substantially in the past year. And the value of these homes in dollars is up even more (about 28%). I had thought that the revenue and profit increase would start to show up in Q1. I was wrong on the timing, but I am confident that the revenues will increase sharply in the remainder of 2016 and this should also lead to substantial earnings gains. Meanwhile, the stock price fell quite substantially in December through to February 10, from about $38 to a low of about $24. This was based on Q4 earnings that were apparently lower than expected and perhaps based on various reports of overall housing starts and home builder sentiment and the generally poor markets in January. Now, Toll Brothers has a backlog of contracted-for homes that seems sure to result in a an earnings increase in 2016 of at least 15% and possibly more like 25%. And it is selling at a modest 21% premium to its accounting book value and at a P/E ratio of 13.6 trailing. The company has also been quite aggressively buying back shares in response to the lower price. Given the expected strong near-term earnings growth, the quality of the company and the relatively modest valuation ratios, I believe this stock merits a rating in the Strong Buy range. But read our full report to better understand our view of this company.