(Bloomberg) -- Toll Brothers Inc. shares surged after the company posted profit that beat estimates and said deposits on new homes were up in recent weeks, a potential sign of optimism for the luxury housing market.
The homebuilder, which focuses on higher-end customers, has struggled during the pandemic. It reported orders for the second quarter that missed estimates and said the key metric had plunged starting March 16, when much of the economy shut down.
But investors shrugged off those results, focusing instead on a 13% year-over-year gain this month in deposits, which the company called a “leading indicator of current market demand.”
“We are very encouraged by recent deposit activity.” Chief Executive Officer Douglas Yearley said in a statement.
The shares jumped as much as 6.7% to $35.20 in New York, the highest intraday price since March 10. The stock was down 16% this year through Wednesday's close, but has rallied in recent weeks.
A surprise gain in U.S. new-home sales has stoked optimism that the housing market is holding up, even with job losses mounting.
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