Shares of Toro Co. rose 0.6% in premarket trading Thursday, after the lawn care equipment company reported fiscal third-quarter profit and sales that rose above expectations, as strength in the residential business helped offset a miss in professional, and raised its full-year outlook as strong demand was expected to offset continued supply chain, inflation and labor pressures. Net income for the quarter to July 30 rose to $96.3 million, or 89 cents a share, from $89.0 million, or 82 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share came to 92 cents, above the FactSet consensus of 78 cents. Sales increased 16.2% to $976.8 million, beating the FactSet consensus of $954.7 million. Professional sales grew 15.2% to $718.5 million, missing the FactSet consensus of $723.1 million, while Residential sales rose 23.0% to $252.1 million to top expectations of $236.2 million. Gross margin fell to 33.9% from 35.0%. For fiscal 2021, the company raised its adjusted EPS guidance range to $3.53 to $3.57 from $3.45 to $3.55 and lifted its sales growth outlook to 17% from 12% to 15%. The stock has slipped 1.3% over the past three months through Wednesday, while the S&P 500 has gained 7.5%.
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