Toast run-up has captured execution, says RBC Capital

RBC Capital keeps a Sector Perform rating and $40 price target on Toast (TOST) while noting that the stock’s run-up has likely already captured the upside as it remains the “most expensive payments stock” in its coverage. The firm’s FY25 sales and marketing expense assumption was increased to $567M from $489M to reflect the investments the company is making in its international and vertical expansion initiatives, with the changes driving a reduction of its adjusted EBITDA estimate to $494M from $517M, the analyst tells investors in a research note.