Toast (TOST) Shares Down 16%, Yet Long-Term Growth Potential Remains Strong
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
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Source: Fool
- Market Reaction: Toast's shares have declined approximately 16% over the past six months, primarily due to investor concerns about the restaurant sector and competitive pressures from software price adjustments, although the company quickly clarified the reasons for the price changes, demonstrating its ability to navigate market volatility.
- Business Model: Toast offers an all-in-one cloud-based technology platform that encompasses everything from point-of-sale to payments, payroll, inventory, and marketing, creating significant switching costs for customers, thereby enhancing customer loyalty and competitive positioning.
- Market Share: With only a 15% market share in the U.S. restaurant market, Toast is consistently adding thousands of new locations each quarter and plans to expand into international markets and adjacent verticals, indicating substantial future growth potential.
- Financial Performance: In Q3 2025, Toast reported revenue of $1.63 billion, a 30% year-over-year increase, with annual recurring revenue exceeding $2 billion and GAAP net income of $105 million, highlighting the company's successful transition towards profitability.
TOST
$36.44+Infinity%1D
Analyst Views on TOST
Wall Street analysts forecast TOST stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for TOST is 47.56 USD with a low forecast of 36.00 USD and a high forecast of 60.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
19 Analyst Rating
11 Buy
8 Hold
0 Sell
Moderate Buy
Current: 36.490
Low
36.00
Averages
47.56
High
60.00
Current: 36.490
Low
36.00
Averages
47.56
High
60.00
About TOST
Toast, Inc. is a cloud-based, all-in-one digital technology platform purpose-built for the entire restaurant community. It provides a platform of software-as-a-service (SaaS) products and financial technology solutions, including integrated payment processing, restaurant-grade hardware, and a broad ecosystem of third-party partners. It serves as the restaurant operating system, connecting front of house and back of house operations across service models including dine-in, takeout, delivery, catering, and retail. Its products include point-of-sale (POS) & restaurant operations, marketing, online ordering & delivery, team management, vendor management, retail, and financial technology solutions. Its in-store POS and restaurant operations offerings are built to help reduce time to take an order, optimize operations, and handle payments. Its marketing products provide integrated solutions to deliver targeted email and SMS campaigns, build loyalty programs, offer gift cards, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
