QUOTE AND NEWS
WA Business News  Sep 19  Comment 
Western Australia’s aspiring uranium miner Toro Energy has reported an $8 million loss for the financial year ending June 2014.
DailyFinance  Sep 16  Comment 
The Toro Company (NYSE: TTC) today announced that its board of directors has declared a regular quarterly cash dividend of $0.20 per share. This dividend is payable on October 14, 2014 to shareholders of record on September...
Forbes  Sep 1  Comment 
PS4 dashboards are about to get a lot more customizable. Sony has just announced that the PS4 will follow in the footsteps of the Vita by adding custom themes to the console's Dashboard. The reveal showcased a few animated themes featuring...
Market Intelligence Center  Aug 29  Comment 
For a hedged play on Toro Co (TTC), MarketIntelligenceCenter.com’s option-trade picking algorithms recommend the Mar. '15 $60.00 covered call for a net debit in the $58.76 area. That is also the break-even stock price for the covered call. This...
SeekingAlpha  Aug 21  Comment 
By SA Transcripts: Toro Company (NYSE:TTC) Q3 2014 Earnings Conference Call August 21, 2014, 11:00 AM ET Executives Amy Dahl - Managing Director, Corporate Communications and Investor Relations Michael Hoffman - Chairman and Chief...
newratings.com  Aug 21  Comment 
WASHINGTON (dpa-AFX) - Turf maintenance equipment maker Toro Co. (TTC), Thursday reported an increase in profit for the third quarter, as revenues registered a double-digit growth and margins improved. Both earnings and revenues for the quarter...
Benzinga  Aug 21  Comment 
The Toro Company (NYSE: TTC) reported better-than-expected earnings for the fiscal third quarter. The Bloomington, Minnesota-company posted quarterly net earnings of $50 million, or $0.87 per share, versus $40.1 million, or $0.68 per share, in...
Market Intelligence Center  Aug 21  Comment 
After closing Wednesday at $61.25, Toro Co (TTC) presents an attractive opportunity to get a 3.54% return in just 121 days, which is an annualized return of 10.67% (for comparison purposes only). To enter this trade, sell one Dec. '14 $60.00 call...
DailyFinance  Aug 14  Comment 
The Toro Company (NYSE: TTC) today announced it will release its fiscal 2014 third quarter results on Thursday, August 21, 2014, at approximately 7:30 a.m. (CDT). The company also will hold an earnings conference call at 10...
Market Intelligence Center  Aug 11  Comment 
MarketIntelligenceCenter.com's patented trade-picking algorithms have identified an attractive covered-call trade on Toro Co (TTC). Look at the Dec. '14 $60.00 covered call for a net debit in the $58.78 area. This trade has a duration of 131...




 
TOP CONTRIBUTORS

The Toro Company (TTC) makes lawn mowers, irrigation systems, snow blowers and other equipment aimed at both professional landscapers and residential homeowners. Toro distributes its products through retailers such as Wal-Mart Stores (WMT) and Home Depot (HD), independent hardware stores as well as direct sales through e-commerce.

Demand for Toro's landscaping and irrigation equipment is directly related to the development of new commercial and residential real estate. A prolonged slump due to subprime lending would likely decrease demand for Toro products, which can be expensive (many finance their purchases).

Business Overview

Toro sells lawn mowers, irrigation systems, snow blowers and other landscaping equipment to residential households as well as commercial landscapers. The company distributes its produces through retail stores such as Wal-Mart Stores (WMT) and Home Depot (HD), as well as other hardware stores and directly to consumers via an e-commerce channel.

Business Financials

Total revenues in 2009 were $1.52 billion, a significant decrease from its 2008 revenues of $1.88 billion. This 18.9% decline in net sales was due to lower demand that resulted because of the global recessionary economic climate.[1]As a result, Toro's net income declined from $120 million in 2008 to $63 million in 2009, a 47.5% decrease.

Business Segments

Toro breaks its business into two business segments: i) Professional and, ii) Residential.

Professional (63% of 2009 Revenues)

Toro's Professional segment produces and sells turf and agricultural products to government customers, rental companies, and large retailers. These customers are generally professional users engaged in creating landscapes, irrigating turf and agricultural fields, and maintaining turf, such as golf courses, sports fields, municipal properties, and residential and commercial landscapes. In 2009, this segment had $965.9 million in total sales.[2]

Residential (35% of 2009 Revenues)

The Residential segment sells products to homeowners through a variety of distribution channels, including outdoor power equipment dealers, hardware retailers, home centers, mass retailers, and over the Internet. This segment also licenses Toro's trade name to other manufacturers and retailers on certain products as a means of expanding its brand name and image. During 2009, this segment posted $532.7 million in revenues.[3]

Other (2% of 2009 Revenue)

Toro's Other segment includes sales from subsidiary distribution companies. In 2009, this segment had $24.8 million in total revenues.[4]

Trends and Forces

U.S. Housing and Commercial Construction

The demand for Toro's landscaping and irrigation equipment is directly related to the development of new commercial and residential real estate. A prolonged slump due to subprime lending would likely decrease demand for Toro products. This is especially true for Toro because many of its products are relatively expensive, requiring many customers to make purchases through third-party financing.

The U.S. Dollar Affects Demand from abroad

Toro generates about 29% of revenue outside the United States. A less valuable U.S. dollar makes Toro's American produced products more attractive on the world market. On the other hand, a strengthening Dollar makes Toro's products more expensive to international buyers, and would reduce overall sales. Toro estimates that the strengthening dollar in 2009 reduced their overall sales by $32 million.[5] However foreign currency fluctuations make sales revenues difficult to predict.

Seasonality and Weather affect earnings

Toro's sales are relatively cyclical with regards to its residential products. More specifically, sales are particularly strong in the second and third quarters of each year, as homeowners stock up on gardening and other outdoor home products. Evidence can be seen in Toro's 2009 quarterly earnings, as 59% of its 2009 revenues for residential products came during the second and third quarters.[6]

Worldwide weather patterns also affect demand for Toro products. Evidence of this is weak snow blower sales during the mild winter of 2006-2007. Conversely, worldwide water shortages are increasing demand for Toro's efficient irrigation systems (see also China's Water Scarcity).

Competition

Toro faces competition from companies including Deere & Company (DE), Black & Decker (BDK), and Honda Motor Company (HMC). In order to remain competitive, Toro must continue to devise and produce innovative high quality products that exceed consumer demands. If Toro fails to successfully innovate, these large competitors will undoubtedly use their superior resources to create products that attract new consumers and reduce Toro's market share. On the other hand, many of these large competitors are highly diversified companies that cannot bring the same focus to lawn care products as Toro.

  • MTD Products produces a wide range of lawn care product lines such as Cub Cadet and Troy-Bilt. MTD is a privately held company.
  • Black & Decker (BDK) produces a variety of lawn and garden equipment, including trimmers, lawn mowers, edgers, and pruners.
  • Makita (MKTAY) has a full line of professional power equipment, including a variety of lawn care products.



References

  1. TTC 10-K 2009 Item 7 Pg. 26
  2. TTC 10-K 2009 Item 7 Pg. 29
  3. TTC 10-K 2009 Item 7 Pg. 30
  4. TTC 10-K 2009 Item 7 Pg. 31
  5. TTC 10-K 2009 Item 7 Pg. 28
  6. TTC 10-K 2009 Item 1 Pg. 7
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