Mizuho sees risk to Toast’s 2024 location add target

Mizuho worries that slowing new restaurant formations could risk Toast’s 2024 location add target. To meet its prior goal, Toast needs to exit the year with at least 133,000 locations but census data for Accommodation and Food Service business formations shows declines in both March and April, the analyst tells investors in a research note. The firm says that even if incremental new formations accelerated by three-times year-over-year and the capture rate recovered to 9% versus 7.2% in Q1, Toast would still fall short of the 133,000 minimum. Mizuho reiterates a Neutral rating on the shares with a $21 price target.