Toast Inc (TOST) AI Stock Analysis

• Market Cap: $22.22B
• Dividend Yield: N/A
• Average Volume (3M): 7.93M
• Price to Earnings (P/E): 113.2
• Beta (1Y): 1.49
• Revenue Growth: 26.11%
• EPS Growth: N/A
• Country: US
• Employees: 5,700
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.25
• Shares Outstanding: 510,000,000
• 10 Day Avg. Volume: 6,819,226
• 30 Day Avg. Volume: 7,929,321
• PEG Ratio: -10.00
• Price to Book (P/B): 13.19
• Price to Sales (P/S): 4.11
• P/FCF Ratio: 66.59
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 4.54
• Enterprise Value/Gross Profit: 18.03
• Enterprise Value/Ebitda: 98.48
• 1Y Price Target: $48.94
• Price Target Upside: 26.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 18

• Rating: 73 Outperform
• Price Target: $43.00 ▲(10.82% Upside)

Toast Inc's overall stock score is driven by strong financial performance and a positive earnings call outlook. However, high valuation metrics and mixed technical indicators temper the score. The company's strategic growth initiatives and robust cash flow generation are significant strengths, while the high P/E ratio and lack of dividend yield present valuation concerns.

Positive Factors

Revenue Growth

The addition of 8,500 new locations reflects robust demand for Toast's platform, suggesting strong revenue growth potential as the company expands its market reach.

International Expansion

International expansion into markets like Australia enhances Toast's global footprint, providing new revenue streams and diversifying market risk.

Strategic Partnerships

The partnership with American Express enhances Toast's service offerings, potentially increasing customer engagement and retention through integrated solutions.

Negative Factors

Margin Pressure

Expected margin pressure in Q4 could impact profitability, highlighting challenges in maintaining cost efficiency amidst external pressures.

GPV Decline

A decline in Gross Payment Volume per location suggests potential difficulties in sustaining transaction volumes, which could affect revenue growth.

High Valuation Concerns

A high P/E ratio suggests that the stock may be overvalued, which could limit future stock price appreciation and attract scrutiny from value-focused investors.

Toast Inc Business Overview & Revenue Model

Company Description

Toast Inc. (TOST) is a technology company that provides an all-in-one restaurant management platform designed to streamline operations for foodservice businesses. Catering primarily to restaurants, Toast offers a comprehensive suite of services that includes point-of-sale (POS) systems, payroll and team management, online ordering, and customer engagement tools. The company operates within the hospitality technology sector, focusing on enhancing the customer experience and improving operational efficiency through its innovative software and hardware solutions.

How the Company Makes Money

Toast generates revenue through several key streams. The primary source is subscription and transaction-based fees from its POS system, which restaurants pay to access the software and hardware tools necessary for managing sales and operations. Additional revenue comes from services such as payment processing, where Toast takes a percentage of each transaction processed through its platform. The company also offers a range of add-on services, including marketing solutions and loyalty programs, which provide further monetization opportunities. Significant partnerships with payment processors and hardware vendors enhance its product offerings, allowing Toast to expand its market reach and drive additional revenue growth.

Toast Inc Financial Statement Overview

Summary

Toast Inc's financial statements reflect strong performance with impressive revenue and profit growth, financial stability with low leverage, and robust cash flow generation. The positive trends in profitability and cash flow indicate a well-managed business with a promising outlook.

Income Statement

Toast Inc has shown impressive revenue growth with a TTM (Trailing-Twelve-Months) growth rate of 5.9%, indicating strong market demand. The gross profit margin has improved to 25.2%, reflecting efficient cost management. Net profit margin has significantly increased to 4.1%, showcasing enhanced profitability. The EBIT and EBITDA margins have also improved, indicating better operational efficiency. Overall, the income statement reflects a positive growth trajectory and profitability improvement.

Balance Sheet

The balance sheet of Toast Inc is strong, with a low debt-to-equity ratio of 0.01, indicating minimal leverage and financial stability. The return on equity (ROE) has improved to 13.9%, reflecting effective use of equity to generate profits. The equity ratio stands at 65.7%, showing a solid equity base. Overall, the balance sheet indicates financial stability and efficient capital management.

Cash Flow

Toast Inc has demonstrated robust cash flow performance with a free cash flow growth rate of 24.5% in the TTM, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 0.62 and free cash flow to net income ratio of 0.91 reflect efficient cash conversion. Overall, the cash flow statement highlights strong cash generation and effective cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.53B	4.96B	3.87B	2.73B	1.71B	823.00M
Gross Profit	1.39B	1.19B	834.00M	511.00M	314.00M	140.00M
EBITDA	255.00M	108.00M	-255.00M	-360.00M	-207.00M	-209.00M
Net Income	224.00M	19.00M	-246.00M	-275.00M	-487.00M	-248.00M
Balance Sheet
Total Assets	2.77B	2.41B	1.96B	1.76B	1.74B	775.96M
Cash, Cash Equivalents and Short-Term Investments	1.70B	1.42B	1.12B	1.02B	1.27B	581.82M
Total Debt	19.00M	24.00M	44.00M	94.00M	99.00M	171.71M
Total Liabilities	949.00M	863.00M	764.00M	663.00M	644.00M	1.25B
Stockholders Equity	1.82B	1.54B	1.19B	1.10B	1.09B	-471.00M
Cash Flow
Free Cash Flow	508.00M	306.00M	93.00M	-189.00M	-17.00M	-161.00M
Operating Cash Flow	558.00M	360.00M	135.00M	-156.00M	2.00M	-125.00M
Investing Cash Flow	-22.00M	-39.00M	-86.00M	-98.00M	-503.00M	-36.00M
Financing Cash Flow	22.00M	18.00M	63.00M	38.00M	759.00M	594.00M

Toast Inc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 38.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOST, the sentiment is Negative. The current price of 38.8 is above the 20-day moving average (MA) of 37.04, below the 50-day MA of 39.74, and below the 200-day MA of 39.89, indicating a neutral trend. The MACD of -0.39 indicates Negative momentum. The RSI at 53.92 is Neutral, neither overbought nor oversold. The STOCH value of 86.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TOST.

Toast Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAYO	75 Outperform	$2.17B	22.79	13.86%	―	13.02%	-2.57%
FOUR	74 Outperform	$6.67B	28.16	19.00%	―	23.86%	79.35%
TOST	73 Outperform	$22.22B	113.15	14.51%	―	26.11%	―
FFIV	63 Neutral	$17.11B	26.62	20.58%	―	8.94%	22.30%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
NTNX	61 Neutral	$18.49B	108.43	―	―	18.11%	―
MQ	55 Neutral	$2.09B	―	-6.51%	―	17.47%	-544.72%

Toast Inc Corporate Events

Toast, Inc. Earnings Call: Strong Growth and Strategic Moves

Toast, Inc. Earnings Call Highlights Strong Growth and Strategic Initiatives

Toast, Inc. Reports Strong Q2 2025 Growth and New Partnerships

Toast, Inc., a leading cloud-based digital technology platform, specializes in providing comprehensive software and financial technology solutions for the restaurant industry, helping streamline operations and enhance guest experiences. In its second quarter of 2025, Toast reported significant growth, adding a record 8,500 new locations and achieving a 31% increase in annualized recurring run-rate to $1.9 billion. The company also announced a strategic partnership with American Express to enhance dining experiences and expand its market reach.