Optimistic Buy Rating for Toast Inc: Strong Market Position and Growth Potential Highlighted by Impressive Financial Performance and Strategic Achievements

William Blair analyst Stephen Sheldon has reiterated their bullish stance on TOST stock, giving a Buy rating today.

Stephen Sheldon’s rating is based on several compelling factors that highlight Toast Inc’s strong market position and growth potential. The company has demonstrated impressive financial performance, with a notable 24% increase in first-quarter revenue year-over-year and a 31% rise in annual recurring revenue. This growth is supported by significant achievements such as acquiring 6,000 new locations and an increase in elective module uptake, which has boosted the SaaS average revenue per user by 5%. Additionally, improvements in payment take rates and gross margins have further strengthened Toast’s financial standing.
Moreover, Toast’s management has raised its guidance for non-GAAP core gross profit growth in 2025, reflecting confidence in sustained growth driven by strategic reinvestments and improving payment take rates. The company’s success in securing large enterprise clients, such as Applebee’s and Topgolf, expands its total addressable market and underscores its robust enterprise pipeline. These factors, combined with record-setting expectations for second-quarter location additions, contribute to Sheldon’s optimistic outlook and Buy rating for Toast Inc.

According to TipRanks, Sheldon is a 2-star analyst with an average return of 0.9% and a 51.43% success rate. Sheldon covers the Technology sector, focusing on stocks such as Olo, Udemy Inc, and Alarm.

In another report released today, Mizuho Securities also reiterated a Buy rating on the stock with a $49.00 price target.