Toro's Next Move: Investing in the Tech Behind the High Life

BLOOMINGTON, MN – November 25, 2025 – As the financial world turns its attention to a flurry of year-end reports, one announcement on December 17 holds particular weight for those invested in the infrastructure of the high life. The Toro Company (NYSE: TTC), a global giant in outdoor environment solutions, will release its fiscal 2025 full-year results, offering a detailed look into the health of a company whose products manicure the world’s most exclusive golf courses, maintain pristine private estates, and build the unseen networks beneath smart cities.

For the discerning investor, Toro's performance is more than just a measure of equipment sales; it's a barometer for trends in luxury leisure, sustainable property management, and next-generation infrastructure. With a diverse portfolio that includes iconic brands like Toro, Ditch Witch, and Exmark, the company’s upcoming earnings call will provide critical insights into how innovation is meeting demand in a complex macroeconomic climate.

A Financial Barometer for the Great Outdoors

Investors are approaching the December announcement with cautious optimism, parsing the company’s recent performance and guidance for clues. The Toro Company concluded fiscal 2024 with solid, if not spectacular, net sales of $4.58 billion and an adjusted diluted EPS of $4.17. Looking ahead to the fiscal 2025 results being announced, management had projected modest net sales growth between 0% and 1%, with an adjusted EPS target in the range of $4.25 to $4.40.

This conservative guidance reflects a nuanced market. While the company anticipates continued strength in its high-margin professional segments, particularly underground construction and golf and grounds, it also acknowledges headwinds from consumer caution and ongoing inventory adjustments in residential lawn care and snow management. Wall Street appears to be in alignment, with a consensus "Hold" rating from analysts and an average 12-month price target of $92.60. The average analyst EPS forecast for fiscal 2025 hovers around $4.13, just shy of management's guidance, suggesting the market is waiting for definitive proof of resilience before fully committing.

The upcoming report will be scrutinized for margin performance. In fiscal 2024, gross margin dipped to 33.8% due to higher material costs and product mix shifts. Investors will be keen to see if productivity improvements and strategic pricing have managed to buffer these pressures, and how the company's free cash flow—a remarkable 112.4% of net income in 2024—has held up.

The Greening of Green Spaces

Beyond the balance sheet, Toro’s results will illuminate its progress in navigating one of the most significant shifts in the luxury market: the demand for sustainability. The global outdoor power equipment (OPE) market, projected to grow from roughly $39 billion in 2025 to over $62 billion by 2034, is being fundamentally reshaped by electrification. High-capacity battery systems, smart IoT-connected tools, and a focus on repairability are no longer niche interests but core demands from affluent homeowners and commercial operators alike.

Toro has positioned itself at the forefront of this movement. A key strategic goal for fiscal 2025 was to have battery and hybrid products account for at least 20% of its total adjusted net sales. The upcoming earnings will be the first major checkpoint on this ambitious target. Success here would not only signal a powerful alignment with market trends but also solidify its brand among environmentally conscious consumers who demand performance without compromise.

This commitment extends beyond electrification. The company’s focus on water efficiency, recognized with a WaterSense® Excellence Award, offers irrigation solutions that are critical for managing sprawling estates and golf courses in water-scarce regions. Furthermore, its Cured-In-Place Pipe (CIPP) technology, a trenchless solution for repairing underground pipes, represents a significant investment in sustainable infrastructure, minimizing disruption and environmental impact. These innovations are not just features; they are becoming essential components of modern luxury property management.

Digging Deeper: From Golf Courses to Urban Infrastructure

A closer look at Toro's segment performance reveals a tale of two markets. The company’s Professional Segment, which accounted for over $3.5 billion in fiscal 2024 sales, is where its deepest moats lie. While residential markets face cyclical softness and inventory issues, the demand from golf courses and for underground construction equipment remains robust. This bifurcation is telling.

The golf and grounds business is a direct reflection of the health of the luxury leisure industry. The maintenance of immaculate fairways and greens at championship-level courses is a non-negotiable expense, insulating this segment from the whims of consumer spending. Strong performance here would indicate continued investment in high-end recreational experiences.

Perhaps even more compelling for forward-looking investors is the performance of the underground construction business, led by the Ditch Witch brand. In an era of 5G rollout, smart grid development, and urban renewal, the demand for equipment that can lay fiber optic cables and utility lines with precision and minimal surface disruption is immense. This segment positions Toro as a critical enabler of the foundational technology powering smart cities and connected communities, representing a long-term growth vector that transcends traditional landscaping.

Navigating a Shifting and Competitive Landscape

Toro does not operate in a vacuum. Its competitors, including Deere & Company, Kubota, and Husqvarna, have reported mixed results, highlighting the sector's complexities. Deere has faced significant declines in its large agricultural division, while Husqvarna has struggled with soft North American demand and pricing pressures. Toro's ability to navigate these same challenges, particularly macroeconomic caution and cost inflation, will be a key theme of the December 17th call.

Management's commentary will be just as important as the numbers themselves. Investors will be listening for updates on strategic initiatives, such as the successful partnership with Lowe's that bolstered residential sales, and for the outlook on fiscal 2026. Analyst projections for 2026 already anticipate a rebound, with average EPS forecasts approaching $4.63 on revenue of $4.60 billion. The upcoming report will provide the context needed to validate that optimism, offering a clearer picture of whether The Toro Company can continue to successfully cultivate the very definition of the high life.