S&P affirms Toll Brothers

Standard & Poor's said it affirmed its BBB- corporate credit rating on Toll Brothers Inc. and its subsidiaries.

At the same time, the agency said it affirmed its BBB- rating on roughly $1.1 billion of senior unsecured notes issued by Toll Brothers Finance Corp. and its BB+ rating on $350 million of senior subordinated notes issued by Toll Corp.

The outlook is stable.

Although operating trends have been weak through this cyclical downturn, the agency said that the ratings on Toll remain supported by sector-leading profit margins, a conservatively leveraged financial profile and very good liquidity.

These strengths are tempered by deteriorating EBITDA-based credit metrics, as Toll's earnings have been negatively affected by sharply lower sales volume, S&P noted.

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