(Reuters) - Toll Brothers Inc’s profit and revenue beat analysts’ estimates, boosted by robust demand and the U.S. luxury homebuilder raised its sales forecast for fiscal 2017.
Shares of the company, which builds homes that can cost upwards of $2 million, rose 3.5 percent in premarket trading on Tuesday.
Orders, a key metric of future revenue for homebuilders, rose 26 percent to 2,511 homes in the second quarter, its best order growth in nearly three years.
“This was the best spring selling season we have had in over 10 years,” Chief Executive Douglas Yearley said on Tuesday.
The number of homes sold rose to 1,638 from 1,304 in the quarter ended April 30.
The U.S. housing industry has seen a steady recovery, driven by an improving job market.
Toll, which has been building luxury homes for half a century, said it expected to sell between 6,950 and 7,450 homes in fiscal 2017, up from its previous forecast of 6,700 to 7,500 homes.
The company raised its full-year revenue forecast range to $5.4 billion-$6.1 billion, from $5.2 billion-$6.2 billion.
Toll also reaffirmed its 2017 adjusted gross margin forecast at 24.8-25.3 percent.
The company said the average price of homes sold fell to $832,400 from $855,500 a year earlier, partly as it rolled out a new line of lower priced homes, T-Select, to cater to millennials who are now starting families.
Horsham, Pennsylvania-based Toll Brothers said its net income rose to $124.6 million, or 73 cents per share, in the quarter from $89.1 million, or 51 cents per share, a year earlier.
Revenue rose 22.2 percent to $1.36 billion.
Analysts on average had expected a profit of 63 cents per share on a revenue of $1.27 billion, according to Thomson Reuters I/B/E/S.
Up to Monday’s close, shares of Toll had risen 22.7 percent this year, while the Dow Jones U.S. home construction index .DJUSHB increased 25.6 percent.
Reporting by Arunima Banerjee in Bengaluru; Editing by Sunil Nair and Arun Koyyur