Toast Inc (TOST) AI Stock Analysis

• Market Cap: $25.58B
• Dividend Yield: N/A
• Average Volume (3M): 8.57M
• Price to Earnings (P/E): 128.0
• Beta (1Y): 1.48
• Revenue Growth: 26.11%
• EPS Growth: N/A
• Country: US
• Employees: 5,700
• Sector: Technology
• Sector Strength: 83
• Industry: Software - Infrastructure
• EPS (TTM): 0.25
• Shares Outstanding: 510,000,000
• 10 Day Avg. Volume: 6,677,134
• 30 Day Avg. Volume: 8,569,373
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 4.54
• Enterprise Value/Gross Profit: 18.03
• Enterprise Value/Ebitda: 103.34
• 1Y Price Target: $52.17
• Price Target Upside: 18.89% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 72 Outperform
• Price Target: $49.00 ▲(11.67% Upside)

Toast Inc's overall stock score is driven by strong financial performance and positive earnings call insights, indicating robust growth and strategic expansion. However, the high valuation and mixed technical indicators suggest caution. The company's focus on innovation and market expansion supports a promising outlook, but investors should be mindful of valuation risks.

Positive Factors

Financial Performance

Toast reported a strong quarter with recurring gross profit and EBITDA metrics surpassing expectations.

Market Expansion

TOST continues to gain share within its core US restaurant market, adding a record number of locations (+8,500 in 2Q).

Strategic Partnerships

TOST announced a partnership with American Express, which should enhance the Local by Toast app with integrated reservations and personalized dining.

Negative Factors

Cost Management

Growth is coming at a higher cost, with guidance indicating lower third-quarter EBITDA compared to typical improvements.

Investment Costs

Management plans to invest in growth market verticals, which crossed 10,000 locations, aiming for $100 million in annual recurring revenue, indicating higher expenditure.

Toast Inc Business Overview & Revenue Model

Company Description

Toast Inc (TOST) is a leading cloud-based restaurant management platform that provides an array of software as a service (SaaS) solutions tailored to the restaurant industry. The company offers a comprehensive suite of products that include point of sale (POS) systems, payment processing, and various management tools designed to improve efficiency and profitability for restaurant operators. Toast's platform is designed to streamline operations, enhance customer experience, and provide data-driven insights to its clients.

How the Company Makes Money

Toast Inc makes money primarily through the sale and subscription of its SaaS products, which include point of sale systems and software solutions tailored for restaurant operations. Revenue is generated from a combination of subscription fees for its software tools, and transaction-based fees through its payment processing services. Additionally, Toast generates revenue from hardware sales, such as terminals and peripherals needed for its POS systems. The company also benefits from partnerships with third-party service providers, which can lead to additional integration fees and enhanced service offerings for its users. These diversified revenue streams enable Toast to maintain a robust financial model centered around the growing demand for technology-driven restaurant management solutions.

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	823.13M
Gross Profit	1.39B	1.19B	834.00M	511.00M	314.00M	140.41M
EBITDA	243.00M	108.00M	-255.00M	-360.00M	-207.00M	-208.22M
Net Income	224.00M	19.00M	-246.00M	-275.00M	-487.00M	-248.20M
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	-160.71M
Operating Cash Flow	558.00M	360.00M	135.00M	-156.00M	2.00M	-124.63M
Investing Cash Flow	-22.00M	-39.00M	-86.00M	-98.00M	-503.00M	-35.86M
Financing Cash Flow	22.00M	18.00M	63.00M	38.00M	759.00M	594.50M

Toast Inc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.88
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TOST, the sentiment is Positive. The current price of 43.88 is below the 20-day moving average (MA) of 44.48, below the 50-day MA of 44.79, and above the 200-day MA of 39.95, indicating a neutral trend. The MACD of -0.62 indicates Positive momentum. The RSI at 47.36 is Neutral, neither overbought nor oversold. The STOCH value of 76.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TOST.

Toast Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAYO	78 Outperform	$2.44B	25.67	13.86%	―	13.02%	-2.57%
FOUR	73 Outperform	$7.91B	33.15	19.00%	―	23.86%	79.35%
TOST	72 Outperform	$25.58B	127.97	14.51%	―	26.11%	―
DBX	68 Neutral	$7.39B	17.28	-60.11%	―	-0.04%	-5.07%
NTNX	63 Neutral	$18.26B	97,285.71	6.85%	―	16.11%	―
Sector *	61 Neutral	$35.62B	7.50	-10.94%	1.87%	8.86%	-10.27%
MQ	61 Neutral	$2.80B	56.63	-6.51%	―	17.47%	-544.72%

Toast Inc Corporate Events

Toast Inc Holds Annual Stockholders Meeting

On June 13, 2025, Toast Inc held its annual meeting of stockholders via live audio webcast. During the meeting, stockholders voted on three proposals. Paul Bell and Hilarie Koplow-McAdams were elected as Class I directors for a three-year term. Ernst & Young LLP was ratified as the independent registered public accounting firm for the fiscal year ending December 31, 2025. Additionally, the compensation of the company’s named executive officers for the fiscal year ended December 31, 2024, was approved on an advisory, non-binding basis.