Latest news with #TOST
CNBC
15-05-2025
- Business
- CNBC
Best stocks: This software name is a category killer and has broken out
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh: Today we're spotlighting a stock you've probably heard me talking about on CNBC over the past few years, Toast (TOST) . For the first time ever, Toast has hit our list of the Best Stocks in the Market . Sean was really excited to write this one up and I was excited to read his take on the fundamental story. My take is very simple — I believe this company has reached the point where it is an established, acknowledged category killer. I love catching stories like these in the earlier stages, before everyone figures out the dominant player is going to have advantages that become cumulative. This is where the Toast story is now. The more penetration they get into a given metropolitan area, the more local service industry workers (and their employers) are comfortable using the software within their counter service or restaurant business. Toast becomes the de facto default option for point-of-sale payment systems. Everyone is trained on it and it becomes entrenched. Once Toast gets to a certain threshold within these markets, it's a wrap. They are then able to knock down the rest of local players and the sales cycle gets shorter and easier. Next they can sell all sorts of horizontal software solutions to the same population of customers — food ordering, staff tracking, payroll, etc. Writing about the company's most recent quarterly report last week, Mizuho analyst Dan Dolev cited the company's ability to defy the "difficult environment" for restaurants and relay strong guidance while giants McDonalds, Sweetgreen and Chipotle were posting warnings. Dan was bullish about Toast's increased take rate as well — they kept 48 basis points of all transaction revenue on their platform (1 basis point equals 0.01%). He sees even more opportunity on this front as contracts with customer-restaurants are renegotiated. I originally put this position on for myself as a trade a long time ago but the more I saw these guys execute, the more I wanted to stay. Now I consider myself a long-term investor in the name. Best Stock Spotlight: Toast Inc (TOST) On the list since: May 13th, 2025 Sean: TOST is a digital platform for 140,000-plus restaurants, generating revenue from subscription fees and transaction fees. Unlike its competitors, Toast intermediates every payment transaction on its platform; it processed more than $150 billion in gross platform volume in 2024. TOST is digitizing the fragmented and highly competitive restaurant industry, and the stock is breaking out. TOST just broke out above its November 2024 high of $43. TOST hasn't traded above the $45 mark since November of 2021. Similar to Monday's Best Stocks in the Market piece on Carvana, TOST has spent a lot of time below all time highs. TOST has been a public company since September of 2021, equal to 916 trading days. Of those 916 trading days, TOST saw an all time high on just 3 of them, and the first 2 all-time highs came on the first and second day of trading. It's last all time high occurred on November 3rd of 2021 — 885 days ago. TOST's all-time low came in May of 2022 in the midst of the hottest run of inflation prints the market had seen since the early 80s. Investors priced in a reduction of restaurant spending by consumers because of this inflation. A recession became the base case for nearly 100% of economists. Those economists were wrong, and we saw the hottest spending trends come into the service category. In 2023, consumer spending on food away from home increased to $1.5 trillion, up from $1.3 trillion in 2022, marking a significant shift as dining out expenditures surpassed grocery spending. TOST is up 254% off its 2022 low. TOST hit $43 in November as the animal spirits about the U.S. economy came roaring into the headlines. From that November level, TOST hit a low of $30 on April 8th, down 30% from November, again reflecting worries about the U.S. consumer and their ability to spend with an ongoing trade war. Again, we're seeing economists throw the recession word around. And again, TOST is shrugging off those worries. High-growth stock TOST is a high-growth business. It has compounded its top line revenue by 48% annually going back to 2020. Their profitability is growing too. Looking at its operating margin from Q4 of 2023 through Q1 of 2025, its gone from -4.1% to 3.7%, growing profitability by 780 basis points. Part of the reason why TOST landed on our list is the outstanding earnings call it just reported. TOST delivered record Q1 2025 results with 31% annual recurring revenue growth, 22% gross payment volume growth, and profitability driven by strong customer spending and massive enterprise wins. TOST added 6,000 net new locations bringing the total to 140,000 locations, which is a 25% YoY increase. Toast's profitability margins have improved significantly. Gross profit margin increased from 20.5% in Q4 2022 to 25.9% in Q1 2025. Operating margin turned positive, going from -12.9% to 3.2%. Net profit margins improved from -12.9% to 4.19%, and EBITDA margin grew from -12.1% to 10.0% over the same period. (data via QUARTR) TOST also reported a partnership with Applebee's, which represents the company's largest deal to date. The enterprise pipeline is described as the strongest it has ever been for TOST, with ongoing conversations with other large brands. The economics of these enterprise deals are super beneficial for TOST, with large value-add ARR opportunities and lower churn rates for larger customers. TOST reported these numbers on May 8, and the stock was up 11.4% the next day. From April 8th through 5/14 the stock is up 50%. The market is pricing in this growth, and the stock is in breakout mode. Risk Management Josh: My instinct here is the stock pulls back and retests the recent breakout. If the volume is light and the buyers come in to defend that gap ($39.75), that becomes the new support and we could be off to the races. If Toast gets back into the gap and fills it, you're back in the $35-$37 range, coincidentally the rising 200-day is there to cushion the fall as well (see below). Toast has been a volatile stock as investors doubted the company's commitment to reaching consistent profitability. Now those doubts are fading away and my hope would be that the volatility can fade with them. DISCLOSURES: Josh owns the stock All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. INVESTING INVOLVES RISK. EXAMPLES OF ANALYSIS CONTAINED IN THIS ARTICLE ARE ONLY EXAMPLES. THE VIEWS AND OPINIONS EXPRESSED ARE THOSE OF THE CONTRIBUTORS AND DO NOT NECESSARILY REFLECT THE OFFICIAL POLICY OR POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC. JOSH BROWN IS THE CEO OF RITHOLTZ WEALTH MANAGEMENT AND MAY MAINTAIN A SECURITY POSITION IN THE SECURITIES DISCUSSED. ASSUMPTIONS MADE WITHIN THE ANALYSIS ARE NOT REFLECTIVE OF THE POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC" TO THE END OF OR OUR DISCLOSURE. Click here for the full disclaimer.
Business Insider
13-05-2025
- Business
- Business Insider
Toast Inc (TOST): New Buy Recommendation for This Technology Giant
Jefferies analyst Samad Samana maintained a Buy rating on Toast Inc (TOST – Research Report) yesterday and set a price target of $50.00. The company's shares closed yesterday at $42.87. Protect Your Portfolio Against Market Uncertainty Discover companies with rock-solid fundamentals in TipRanks' Smart Value Newsletter. Receive undervalued stocks, resilient to market uncertainty, delivered straight to your inbox. According to TipRanks, Samana is a 4-star analyst with an average return of 4.7% and a 49.03% success rate. Samana covers the Technology sector, focusing on stocks such as HubSpot, ServiceNow, and Shopify. In addition to Jefferies, Toast Inc also received a Buy from BMO Capital's Rufus Hone in a report issued on May 9. However, on the same day, BTIG maintained a Hold rating on Toast Inc (NYSE: TOST). The company has a one-year high of $44.12 and a one-year low of $21.32. Currently, Toast Inc has an average volume of 7.78M. Based on the recent corporate insider activity of 130 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of TOST in relation to earlier this year. Most recently, in March 2025, PATRICK DEVAL L , a Director at TOST sold 34,222.00 shares for a total of $1,129,326.00.
Yahoo
10-05-2025
- Business
- Yahoo
Why Toast, Inc. (TOST) Soared On Friday
We recently published a list of In this article, we are going to take a look at where Toast, Inc. (NYSE:TOST) stands against other Friday's best-performing stocks. The stock market edged lower on the last day of the trading week as investors sold off positions to mitigate risks from the anticipated trade talks between the US and China this weekend. The Dow Jones and the S&P 500 both fell by 0.29 percent and 0.07 percent, respectively. In contrast, the tech-heavy Nasdaq ended flat. Beyond the major indices, 10 companies traded strongly, finishing with as much as double-digit gains, thanks to the continued positive earnings performance and optimistic outlooks. In this article, we name Friday's 10 best-performing stocks and detail the reasons behind their gains. To come up with the list, we considered only the stocks with a $2-billion market capitalization and $5-million trading volume. An aerial shot of a computer server station, highlighting the company's focus on cloud-based technology. Toast Inc. saw its share prices surge by 11.43 percent on Friday to end at $40.84 apiece after jumping to profitability in the first quarter of the year. In its earnings release, Toast, Inc. (NYSE:TOST) said it achieved a net income of $56 million during the period, a reversal from the $83 million net loss in the same period last year. Revenues were higher by 24 percent to $1.3 billion from $1.07 billion year-on-year, primarily driven by its financial technology solutions and subscription services, which partially offset the decline in revenues from hardware and professional services. For the full year 2025, Toast, Inc. (NYSE:TOST) expects to book between $1.775 billion and $1.795 billion in revenues from its subscription services and financial technology solutions, or a 25 to 27 percent growth from the first quarter of 2024. For the second quarter alone, revenues from the same segment are expected to increase by 26 to 29 percent to a range of $435 million to $445 million. Overall, TOST ranks 6th on our list of Friday's best-performing stocks. While we acknowledge the potential of TOST as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TOST but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
10-05-2025
- Business
- Yahoo
Why Toast, Inc. (TOST) Soared On Friday
We recently published a list of In this article, we are going to take a look at where Toast, Inc. (NYSE:TOST) stands against other Friday's best-performing stocks. The stock market edged lower on the last day of the trading week as investors sold off positions to mitigate risks from the anticipated trade talks between the US and China this weekend. The Dow Jones and the S&P 500 both fell by 0.29 percent and 0.07 percent, respectively. In contrast, the tech-heavy Nasdaq ended flat. Beyond the major indices, 10 companies traded strongly, finishing with as much as double-digit gains, thanks to the continued positive earnings performance and optimistic outlooks. In this article, we name Friday's 10 best-performing stocks and detail the reasons behind their gains. To come up with the list, we considered only the stocks with a $2-billion market capitalization and $5-million trading volume. An aerial shot of a computer server station, highlighting the company's focus on cloud-based technology. Toast Inc. saw its share prices surge by 11.43 percent on Friday to end at $40.84 apiece after jumping to profitability in the first quarter of the year. In its earnings release, Toast, Inc. (NYSE:TOST) said it achieved a net income of $56 million during the period, a reversal from the $83 million net loss in the same period last year. Revenues were higher by 24 percent to $1.3 billion from $1.07 billion year-on-year, primarily driven by its financial technology solutions and subscription services, which partially offset the decline in revenues from hardware and professional services. For the full year 2025, Toast, Inc. (NYSE:TOST) expects to book between $1.775 billion and $1.795 billion in revenues from its subscription services and financial technology solutions, or a 25 to 27 percent growth from the first quarter of 2024. For the second quarter alone, revenues from the same segment are expected to increase by 26 to 29 percent to a range of $435 million to $445 million. Overall, TOST ranks 6th on our list of Friday's best-performing stocks. While we acknowledge the potential of TOST as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TOST but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-05-2025
- Business
- Yahoo
TOST Q1 Earnings Call: Revenue Misses Estimates, Margin Expansion and Enterprise Growth Highlighted
Restaurant software platform Toast (NYSE:TOST) fell short of the market's revenue expectations in Q1 CY2025, but sales rose 24.4% year on year to $1.34 billion. Its non-GAAP profit of $0.24 per share was 30.1% above analysts' consensus estimates. Is now the time to buy TOST? Find out in our full research report (it's free). Revenue: $1.34 billion vs analyst estimates of $1.35 billion (24.4% year-on-year growth, 0.8% miss) Adjusted EPS: $0.24 vs analyst estimates of $0.19 (30.1% beat) Adjusted Operating Income: $133 million vs analyst estimates of $107 million (9.9% margin, 24.3% beat) EBITDA guidance for the full year is $550 million at the midpoint, above analyst estimates of $524.9 million Operating Margin: 3.2%, up from -5.2% in the same quarter last year Free Cash Flow Margin: 5.2%, down from 10% in the previous quarter Annual Recurring Revenue: $1.71 billion at quarter end, up 31.3% year on year Billings: $1.34 billion at quarter end, up 23% year on year Market Capitalization: $21.18 billion Toast's first quarter results were shaped by accelerating customer adoption across its core U.S. small and medium restaurant segment and expanding presence in new markets, including enterprise and international. CEO Aman Narang pointed to over 6,000 net new locations added and highlighted marquee wins such as Applebee's and Topgolf as evidence of Toast's ability to serve both traditional restaurants and complex, large-scale operations. Management attributed performance to increased attach rates for its platform solutions and ongoing investments in sales productivity and product differentiation, particularly in AI-powered tools like Sous Chef and ToastIQ. For the rest of the year, management's guidance reflects expectations of sustained location growth, stable consumer demand, and margin expansion—tempered by a cautious approach to macroeconomic uncertainty and hardware tariff impacts. CFO Elena Gomez stated, 'We are on track for another year of strong top line growth and expanding profitability, while continuing to invest in our highest priority long-term growth initiatives." The company is maintaining a balanced approach to pricing and cost control, with an emphasis on scaling its platform and carefully navigating potential macro headwinds. Management's commentary emphasized the company's multi-pronged growth strategy and the operational drivers behind the quarter's performance. Key drivers included strong execution in Toast's core segments, early traction in new markets, and a focus on product innovation. Core SMB Segment Growth: Toast's main source of expansion came from increasing its footprint among small and medium-sized U.S. restaurants, supported by higher sales productivity and targeted go-to-market initiatives. Enterprise and Upmarket Momentum: Wins with brands like Applebee's and Topgolf showcased Toast's increasing ability to serve large chains and complex operations. Management cited lower churn, attractive payback periods, and healthy average revenue per user (ARPU) in enterprise deals. International and New Verticals Expansion: Progress in international markets and ventures into food and beverage retail and non-traditional formats illustrated the scalability of Toast's platform. Management expects new segments to become more meaningful contributors over time. AI-Driven Product Differentiation: Investments in products such as Sous Chef and ToastIQ are aimed at simplifying restaurant operations and increasing customer value. Early pilots have shown improvements in order size and marketing effectiveness, though monetization remains at an early stage. Cost Discipline and Margin Focus: Operating expenses were managed tightly, with sales and marketing investments prioritized for growth areas. Efforts to optimize payments and hardware costs, along with supply chain diversification to mitigate tariffs, supported margin expansion. Looking ahead, management expects location growth and product attach rates to remain the main drivers of revenue, while ongoing investments in AI and international expansion will shape the company's margin profile. Expansion Across Core and New Markets: Sustained growth in the U.S. core restaurant market and increasing contributions from enterprise, international, and retail segments are expected to drive both top-line and recurring revenue expansion. AI and Platform Integration: Further development and rollout of AI-powered features, such as ToastIQ and Sous Chef, are projected to enhance customer value and platform differentiation, though management cautions that monetization will occur gradually as adoption grows. Macroeconomic and Tariff Uncertainty: The company is monitoring consumer spending trends and potential tariff impacts on hardware, with plans to balance pricing actions and cost management to maintain attractive payback periods and margin growth. Timothy Chiodo (UBS): Asked about differences in payback periods for large enterprise wins like Applebee's versus SMB clients. Management responded that paybacks remain attractive due to scale and low churn, and most enterprise deals include payments. Darrin Peller (Wolfe Research): Questioned macro trends and the degree of conservatism in guidance. Management indicated stable consumer and new business formation trends but acknowledged monitoring for any changes. Stephen Sheldon (William Blair): Sought updates on the timing and monetization of AI solutions such as Sous Chef and ToastIQ. CEO Aman Narang said the focus is on driving customer impact, with monetization to follow as adoption grows. Dominic Ball (Redburn Atlantic): Inquired about competition from emerging POS providers, including DoorDash's hospitality suite. Narang emphasized Toast's vertical platform strategy and ongoing investment in differentiation. Harshita Rawat (Bernstein): Asked about hardware tariffs and supply chain strategy. CFO Elena Gomez said incremental costs are manageable, with supply chain diversification reducing exposure and pricing actions considered holistically. In future quarters, the StockStory team will be watching (1) whether Toast can sustain net new location growth in both core and enterprise segments; (2) the commercial rollout and customer adoption of AI-powered features like ToastIQ and Sous Chef; and (3) the company's ability to manage hardware costs and tariff impacts without eroding margins. Progress in international and retail verticals will also serve as a measure of Toast's long-term expansion potential. Toast currently trades at a forward price-to-sales ratio of 3.5×. At this valuation, is it a buy or sell post earnings? See for yourself in our free research report. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
