Wall Street Zen Downgrades Toast (NYSE:TOST) to Hold

Key Points

• Wall Street Zen downgraded Toast from buy to hold, adding to a mixed analyst backdrop. Overall, the stock still carries a consensus rating of Moderate Buy with a consensus target price of $38.71.
• Toast’s latest quarter showed revenue growth of 22% to about $1.63 billion, but earnings per share of $0.16 missed analyst expectations. The company also raised its FY2026 outlook, guiding for $790 million to $810 million in adjusted EBITDA.
• The stock has been under pressure, recently trading around $25.03 versus a 52-week high of $49.66. Analyst caution has also increased, with firms like Citigroup cutting their price target to $36 from $42.

Toast (NYSE:TOST - Get Free Report) was downgraded by research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a report issued on Saturday.

Several other equities analysts have also recently weighed in on the company. BMO Capital Markets started coverage on Toast in a report on Tuesday, April 21st. They issued an "outperform" rating and a $35.00 price objective for the company. DA Davidson reiterated a "neutral" rating and issued a $33.00 price target on shares of Toast in a research report on Tuesday. UBS Group dropped their price objective on Toast from $40.00 to $34.00 and set a "buy" rating on the stock in a research note on Friday. Citigroup dropped their price objective on Toast from $42.00 to $36.00 and set a "buy" rating on the stock in a research note on Friday. Finally, Canaccord Genuity Group set a $37.00 price target on Toast in a research note on Friday, February 13th. One research analyst has rated the stock with a Strong Buy rating, sixteen have issued a Buy rating and seven have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and a consensus target price of $38.71.

Toast Stock Performance

NYSE:TOST opened at $25.03 on Friday. The stock has a 50-day simple moving average of $27.82 and a 200 day simple moving average of $31.77. The company has a market cap of $12.90 billion, a PE ratio of 38.50 and a beta of 1.81. Toast has a 52-week low of $24.04 and a 52-week high of $49.66.

Toast (NYSE:TOST - Get Free Report) last posted its quarterly earnings results on Thursday, February 12th. The company reported $0.16 earnings per share for the quarter, missing analysts' consensus estimates of $0.24 by ($0.08). Toast had a net margin of 6.39% and a return on equity of 20.87%. The company had revenue of $1.63 billion during the quarter, compared to the consensus estimate of $1.62 billion. During the same quarter in the prior year, the business earned $0.05 earnings per share. The firm's revenue for the quarter was up 22.0% compared to the same quarter last year. On average, research analysts predict that Toast will post 0.81 earnings per share for the current fiscal year.

Toast announced that its board has initiated a stock buyback plan on Thursday, February 12th that allows the company to buyback $0.00 in shares. This buyback authorization allows the company to buy shares of its stock through open market purchases. Shares buyback plans are usually a sign that the company's board believes its shares are undervalued.

Insider Activity

In other news, CFO Elena Gomez sold 8,929 shares of Toast stock in a transaction dated Thursday, April 2nd. The stock was sold at an average price of $26.19, for a total value of $233,850.51. Following the transaction, the chief financial officer owned 173,064 shares in the company, valued at approximately $4,532,546.16. The trade was a 4.91% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, President Stephen Fredette sold 7,289 shares of Toast stock in a transaction dated Thursday, April 2nd. The stock was sold at an average price of $26.19, for a total value of $190,898.91. Following the completion of the transaction, the president owned 920,985 shares in the company, valued at approximately $24,120,597.15. This represents a 0.79% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders have sold 39,783 shares of company stock valued at $1,041,917. 12.14% of the stock is owned by insiders.

Institutional Inflows and Outflows

Hedge funds have recently bought and sold shares of the business. Bayban purchased a new position in Toast during the 4th quarter valued at about $25,000. Quent Capital LLC purchased a new position in shares of Toast during the 3rd quarter worth approximately $27,000. SHP Wealth Management purchased a new position in shares of Toast during the 4th quarter worth approximately $29,000. Strive Financial Group LLC purchased a new stake in Toast in the fourth quarter worth $29,000. Finally, Central Pacific Bank Trust Division grew its stake in Toast by 123.5% in the fourth quarter. Central Pacific Bank Trust Division now owns 943 shares of the company's stock worth $33,000 after purchasing an additional 521 shares during the period. Hedge funds and other institutional investors own 82.91% of the company's stock.

Key Headlines Impacting Toast

Here are the key news stories impacting Toast this week:

• Positive Sentiment: Toast raised its full-year profitability outlook, guiding to $790 million to $810 million in adjusted EBITDA for FY2026, supported by expected 21% to 23% recurring gross profit growth. Article Title
• Positive Sentiment: Revenue continued to grow at a strong pace, with Q1 sales of about $1.63 billion and year-over-year growth around 22%, showing the business is still expanding quickly. Article Title
• Neutral Sentiment: Analysts were mixed on the quarter: some reports said Toast beat earnings expectations, while others said adjusted EPS came in below estimates depending on the metric used, which may be adding to the confusion around the stock. Article Title
• Neutral Sentiment: Toast’s Q1 earnings call transcript and related coverage suggest investors are still parsing management’s commentary for signs of margin durability and growth momentum. Article Title
• Negative Sentiment: The stock is under pressure because the market appears focused more on any earnings disappointment and valuation concerns than on the improved guidance. Article Title
• Negative Sentiment: Citigroup cut its price target on Toast to $36 from $42, signaling a more cautious near-term outlook even while maintaining a buy rating. Article Title

Toast Company Profile

Toast, Inc NYSE: TOST is a technology company that builds a cloud-based platform for restaurants and other foodservice businesses. Headquartered in Boston, Massachusetts, Toast offers integrated point-of-sale (POS) systems and a suite of software and hardware designed to streamline front-of-house and back-of-house operations. The company went public in 2021 and has positioned itself as a vertically integrated provider for the restaurant industry.

Toast's product portfolio includes touchscreen POS terminals and handheld order-and-pay devices, kitchen display systems, and peripherals tailored for high-volume foodservice environments.

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