BTIG analyst Andrew Harte has maintained their neutral stance on TOST stock, giving a Hold rating on February 5.
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Andrew Harte’s rating is based on several considerations pertaining to Toast Inc’s financial outlook and market performance. One of the primary reasons for the Hold rating is the perceived imbalance between risk and reward at current valuation levels. Harte’s multi-year analysis suggests that the current stock price may not adequately compensate for potential risks, especially if Toast’s future financial performance does not align with optimistic projections.
Another significant factor is the expected FY25 EBITDA guidance, which Harte anticipates will fall short of consensus estimates. This expectation stems from management’s comments indicating a more modest margin expansion than what analysts have projected. Additionally, while location growth is a strong point for Toast, investors are less enthusiastic about the decelerating growth in SaaS ARPU. The relatively high valuation of Toast’s stock, as indicated by its EV/GP multiple, leaves little room for operational errors, further supporting the Hold recommendation.
In another report released on February 5, D.A. Davidson also maintained a Hold rating on the stock with a $38.00 price target.
TOST’s price has also changed dramatically for the past six months – from $23.970 to $39.750, which is a 65.83% increase.