NYSE$TTC

The Toro Company · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported record results for the second-quarter of fiscal 2023, driven by strong professional segment performance and continued production improvements.

The Toro Company reported record second-quarter results with net sales of $1.34 billion, up 7% year over year, and diluted EPS of $1.59, up 28% year over year. The professional segment drove these results due to continued demand, operational execution, and supply chain improvements. The company narrowed its full-year fiscal 2023 net sales and adjusted diluted EPS guidance ranges.

  • Record second-quarter net sales of $1.34 billion, up 7% year over year.
  • Record second-quarter reported diluted EPS of $1.59, up 28% year over year.
  • Record second-quarter adjusted diluted EPS of $1.58, up 26% year over year.
  • Full-year fiscal 2023 net sales and adjusted diluted EPS guidance ranges narrowed.

Headline financials

Total Revenue

$1.34B

Previous: $1.25B+7.2%
EPS (adj)

$1.58

Previous: $1.25+26.4%
Gross Margin

35.8%

Previous: 32.4%+10.5%
Capital Expenditures

-$70.1M

Previous: -$36M-94.8%
Free Cash Flow

-$8.44M

Previous: $6.9M-222.4%
Net Income

$167M

Previous: $131M+27.7%
Operating Income

$219M

Previous: $171M+28.3%
Gross Profit

$480M

Previous: $405M+18.3%
Cash & Equivalents

$151M

Previous: $263M-42.5%
Total Assets

$3.74B

Previous: $3.48B+7.5%
Stock-Based Comp

$5.55M

Previous: $5.91M-6.1%

Revenue & EPS history

Toro · Revenue · Quarterly

$1.34B

Q2 2023+7.2%vs Q2 2022
Beat estimate in 5 of 16 quarters(31%)
ActualEstimate

Revenue by segment

Toro · $1.34B total across 3 segments · Q2 2023

  • Professional
    $1.07B+15.4%
  • Residential
    $266M-16.8%
  • Other
    $4.76M+19.1%

Forward guidance

For fiscal 2023, management is narrowing guidance, and now expects net sales growth in the range of 7% to 8% and adjusted diluted EPS in the range of $4.70 to $4.80. This updated guidance is based on current visibility in this evolving and dynamic macro environment, and reflects expectations for continued strong demand across key professional segment markets, reduced volume for solutions geared to homeowners, and continued operational execution.

Tailwinds

  • Continuing strong demand for professional segment products in construction, and golf and grounds markets.
  • Substantial order backlog for professional segment products.
  • Indications of a steadily improving supply chain.
  • Continuation of improved production rates for key categories.
  • Expect benefits from residential segment’s refreshed product lineup, expanded channel, and strong brand to continue to drive competitive advantage for the long term.

Headwinds

  • Sales volume in the residential segment expected to be challenged by macroeconomic uncertainty and consumer spending patterns.
  • Residential segment sales volume also expected to reflect the impact of the unfavorable weather year to date.
  • The company manages through economic cycles and weather patterns with agility and resiliency.
  • Company leverages innovation and synergies across its broad portfolio.
  • Company has a talented team and best-in-class distribution and service networks.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

-0.4%

Avg return

Earnings day

-1.0%

Avg return

5 days after

-1.3%

Avg return

30 days after

43%

30 / 69 earnings

Positive

+20.5%

Q2 2024

Best reaction

-17.4%

Q3 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026-2.4%+0.8%
Q1 2026-2.1%-1.8%-8.0%
Q4 2025+10.7%+8.0%+23.3%
Q3 2025-0.0%-2.2%-4.6%
Q2 2025+2.4%+3.1%+8.4%
Q1 2025-4.9%-3.3%-15.7%
Q4 2024-4.9%-6.0%-2.2%
Q3 2024-9.8%-9.0%-7.7%
Q2 2024+20.5%+19.8%+10.7%
Q1 2024-4.8%-5.9%-7.4%
Q4 2023+11.6%+10.7%+4.0%
Q3 2023-17.4%-17.4%-15.4%
Q2 2023-7.6%-6.3%-3.3%
Q1 2023-3.5%-2.4%-10.8%
Q4 2022-0.8%+0.9%-2.3%
Q3 2022-0.3%+2.6%+4.3%
Q2 2022+6.6%+7.7%-5.0%
Q1 2022-6.7%-14.6%-10.6%
Q4 2021+0.9%-4.9%+0.2%
Q3 2021+1.2%-1.4%-9.5%
Q2 2021-4.2%-2.8%+1.2%
Q1 2021-1.7%-2.7%+5.1%
Q4 2020+0.8%+1.7%+5.2%
Q3 2020+2.6%+2.4%+8.0%
Q2 2020+2.1%+1.4%-6.4%
Q1 2020-2.4%-4.7%-19.3%
Q4 2019-5.4%-1.6%+2.7%
Q3 2019-1.2%-1.7%+0.5%
Q2 2019-6.5%-7.9%-1.4%
Q1 2019+3.3%+2.6%+9.5%
Q4 2018-1.8%-2.9%-5.1%
Q3 2018-2.9%-0.9%+1.1%
Q2 2018+0.8%+0.2%-1.0%
Q1 2018+2.4%+3.3%-3.9%
Q4 2017+2.9%+0.8%+4.1%
Q3 2017-10.8%-12.6%-10.7%
Q2 2017+0.4%+1.2%+5.5%
Q1 2017-1.0%-0.8%+0.4%
Q4 2016+3.9%+1.5%+5.0%
Q3 2016+3.8%+5.0%+0.2%
Q2 2016-3.4%
Q1 2016+5.3%
Q4 2015+0.7%
Q3 2015-0.7%
Q2 2015+0.5%
Q1 2015-1.5%
Q4 2014-6.0%
Q3 2014+2.4%
Q2 2014+2.4%
Q1 2014-0.3%
Q4 2013-1.2%
Q3 2013+10.0%
Q2 2013+2.5%
Q1 2013-0.4%
Q4 2012-6.6%
Q3 2012+1.2%
Q2 2012-1.2%
Q1 2012+1.1%
Q4 2011+1.7%
Q3 2011-4.5%
Q2 2011-2.5%
Q1 2010-2.8%
Q1 2011-1.6%
Q4 2008-1.7%
Q4 2010-1.7%
Q2 2010-1.7%
Q4 2009+2.8%
Q3 2010+2.8%
Q3 2009+2.8%

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