Business Description
Toast, Inc. delivers a comprehensive cloud-based digital technology platform tailored specifically for the restaurant sector, serving businesses across the United States and Ireland. Its extensive product suite features an array of hardware solutions, including the foundational Toast Point of Sale (POS) system. Toast Flex offers versatile functionality, adaptable as an on-counter order and payment terminal, a server workstation, a guest kiosk, a kitchen display system, or an order fulfillment hub. For enhanced tableside service and expedited table turnover, the company provides Toast Go, a handheld POS device facilitating ordering and payment acceptance directly at the table, alongside Toast Tap, a compact card reader. Beyond hardware, Toast supplies robust software solutions. Toast Order & Pay empowers guests to place orders and settle bills conveniently from their mobile devices. The platform integrates specialized kitchen display system software, streamlining communication between front-of-house staff and the kitchen team. For larger operations, multi-location management software enables customers to centralize operational control, standardize procedures, and efficiently configure menus. Back-office administrative tasks are supported by xtraCHEF tools. Furthermore, Toast Flex for Kitchen provides a larger, mountable hardware solution designed specifically as a kitchen screen. Regarding customer engagement and logistics, Toast offers the Toast Online Ordering & Toast TakeOut app, a software platform enabling restaurants to accept off-premises orders directly through their branded websites. For delivery, they provide First-Party Delivery services, allowing restaurants to manage their own driver fleets and customize delivery parameters such as hours, zones, fees, and minimum order values. Additionally, Toast Delivery Services connects restaurants with a network of third-party delivery drivers, complemented by broader Toast Delivery Partners services. The company's offerings extend to comprehensive business support services. These encompass loyalty programs and gift card management, payroll and team administration tools, tailored business owner policy insurance with restaurant-specific enhancements, and efficient payment processing solutions. Toast also facilitates financial support through loans advanced to restaurants and purchase financing options. Detailed reporting and analytics solutions provide valuable insights. For broader integration, Toast Partner Connect allows users to discover, select, and seamlessly integrate with various third-party partners via bi-directional APIs. Established in 2011, Toast, Inc. maintains its headquarters in Boston, Massachusetts.
Business History
Generated: Jun 14, 2026 3:02amPrice Overview
Last updated: Jun 14, 2026 3:00am (13d ago)Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 0.59
Total Equity: $2.12B
Shares: 607,000,000
Total Debt: $20.00M
Cash: $1.35B
EBITDA: $413.00M
Total Debt: $20.00M
Cash: $1.35B
Revenue: $6.15B
Revenue: $6.15B
Revenue: $6.15B
Total Equity: $2.12B
Tax Rate: 1.2%
Equity: $2.12B
Total Debt: $20.00M
Cash: $1.35B
Current Liabilities: $969.00M
Long-Term Debt: $20.00M
Total Debt: $20.00M
Total Equity: $2.12B
Shares: 607,000,000
Shares: 607,000,000
CapEx: -$53.00M
Shares: 607,000,000
Stock Price: $24.82
Net Income: $342.00M
Industry Benchmarks
Advanced Analysis Forensic deep-dive · three lenses
The trajectory is one of the cleaner SaaS inflections in the data: revenue compounded from $1.71B (2021) to $6.15B (2025), gross margin expanded from 18.4% to 25.8%, and operating margin moved from -13.4% to +5.0% — that is real operating leverage, not a one-quarter cosmetic flip. FCF went from -$17M to +$608M in four years, net income crossed into the black at $342M in 2025, and the balance sheet carries $1.99B liquid against minimal debt with an Altman Z of 10.82. Accruals at -15.7% of assets and OCF/NI of 4.18x say the reported earnings are, if anything, conservative vs cash — Beneish -3 corroborates no manipulation signal.
The blemish is per-share discipline. Diluted shares grew from 502.6M to 607M, a ~20% increase over four years (4.8% CAGR), with SBC at 3.9% of revenue and buybacks recouping only 13.8% of that issuance. So while absolute FCF growth is spectacular, per-share economics are taxed by ~5%/yr of dilution, and insider activity is exclusively option exercises followed by sales (19 sells, 0 open-market buys) — normal for tech execs but no conviction signal.
Durability looks reasonable: Toast is the entrenched restaurant POS/payments platform, and the margin expansion alongside revenue scaling implies the unit economics and network density are working. The mechanical forensic checks are all green, classification as 'mature_earner' fits — this is no longer a speculative growth shell, it's a profitable, cash-generative platform business with one real shareholder-unfriendly habit.
Verify before trusting this (5)
- Restaurant location count growth and net revenue retention — confirms whether the platform is still gaining share or maturing
- Payments take-rate trend and any disclosure on interchange/processing economics that drove the GM expansion
- Detail on SBC plan vesting schedule and any commitment to a meaningful buyback program to offset dilution
- Customer concentration / SMB churn rate, since restaurant clientele is cyclical and credit-sensitive
- Competitive positioning vs Square/Block, Clover, and vertical-specific POS entrants — moat is asserted but not provable from financials alone
Toast generated ~$608M of FCF on a $14.4B market cap — roughly a 4.2% FCF yield for a still-low-margin (5% operating margin) software-plus-payments business growing fast. That's not expensive for a quality compounder, but it's not cheap either; you're paying a full multiple for the assumption that operating margin keeps marching from 5% toward 15-20% and that net revenue retention stays sticky. The e2e synthesis itself flags 'High Conviction Required,' which is code for: the fair value only works if you believe the bull case.
Deserved value here leans on continued FCF expansion and operating leverage. Even generously crediting Toast with 25-30x FCF on a forward basis (~$750-900M FCF), you land in the $19-27B enterprise value zone — i.e., today's price brackets a reasonable deserved range rather than sitting clearly below it. SBC-driven dilution is a real haircut on per-share value that the headline FCF flatters. Net: no meaningful margin of safety, no obvious overvaluation either. Classic 'good business the market understands.'
Verify before trusting this (5)
- Forward operating margin guidance and whether incremental margins are actually expanding QoQ
- Net revenue retention and location churn — the linchpin of the 'sticky OS' thesis
- SBC as % of revenue and diluted share count trajectory — is dilution decelerating?
- Payments take-rate trends and any signs of pricing pressure from larger restaurant chains
- FCF composition — how much is working capital tailwind vs durable earnings power
Toast is riding a constructive sentiment setup: a platform-monopoly narrative (sticky restaurant OS) with moderate intensity and durability, strong 26% CAGR momentum, and an analyst consensus skewed Buy with a $36 target versus $24.62 spot - implying ~46% upside the Street still endorses. A fresh upward revision this month signals tone is firming, not fading, and there is no visible bear catalyst breaking the story. The macro tape is the swing factor. The regime is technically neutral but VIX at 17.3 (above 56% of the past year) and a 1.76 beta mean any risk-off lurch gets amplified through this name roughly 1.8x. As a high-multiple, cash-thin SaaS story in a consumer-exposed vertical (restaurants), TOST sits in exactly the cohort that gets sold first when rates back up or growth-narrative air comes out. 10y at 4.48% is a persistent low-grade headwind on the multiple. Net: the story is intact, analysts are leaning in, momentum is with the bulls - tailwind - but it is not a Strong Tailwind because the cult coefficient is low (no fanatic bid) and macro fragility caps the asymmetry.
Verify before trusting this (4)
- Next earnings print on net adds and take-rate - any churn uptick would crack the platform-monopoly story fast
- Watch for sector rotation out of high-beta SaaS if 10y pushes back above 4.6%
- Restaurant industry same-store traffic data - a consumer rollover hits TOST narrative directly
- Whether the lone $32 revision broadens into a wave or stays isolated
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Income Statement (Annual)
Last updated: Jun 14, 2026 3:07am (13d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $1.7B | $2.7B | $3.9B | $5.0B | $6.2B |
| Cost of Revenue | $1.4B | $2.2B | $3.0B | $3.8B | $4.6B |
| Gross Profit | $314.0M | $511.0M | $834.0M | $1.2B | $1.6B |
| Operating Expenses | $542.0M | $895.0M | $1.1B | $1.2B | $1.3B |
| Operating Income | -$228.0M | -$384.0M | -$287.0M | $16.0M | $305.0M |
| Net Income | -$487.0M | -$275.0M | -$246.0M | $19.0M | $342.0M |
| EBITDA | -$457.0M | -$253.0M | -$212.0M | $108.0M | $413.0M |
| EPS | $-0.97 | $-0.72 | $-0.47 | $0.03 | $0.59 |
| EPS (Diluted) | — | — | — | — | — |
Balance Sheet (Annual)
Last updated: Jun 14, 2026 3:00am (13d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $809.0M | $547.0M | $605.0M | $903.0M | $1.4B |
| Total Current Assets | $1.5B | $1.4B | $1.5B | $1.9B | $2.7B |
| Total Assets | $1.7B | $1.8B | $2.0B | $2.5B | $3.1B |
| Current Liabilities | $352.0M | $496.0M | $663.0M | $811.0M | $969.0M |
| Long-Term Debt | $0 | $0 | $0 | $0 | $20.0M |
| Total Liabilities | $644.0M | $663.0M | $764.0M | $918.0M | $1.0B |
| Total Equity | $1.1B | $1.1B | $1.2B | $1.5B | $2.1B |
| Retained Earnings | -$1.1B | -$1.4B | -$1.6B | -$1.6B | -$1.3B |
Cash Flow (Annual)
Last updated: Jun 14, 2026 3:07am (13d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $2.0M | -$156.0M | $135.0M | $360.0M | $661.0M |
| Capital Expenditure | -$19.0M | -$33.0M | -$42.0M | -$54.0M | -$53.0M |
| Free Cash Flow | -$17.0M | -$189.0M | $93.0M | $306.0M | $608.0M |
| Acquisitions (net) | -$26.0M | -$46.0M | -$9.0M | $0 | $0 |
| Debt Repayment | — | — | — | — | — |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | $0 | $0 | $0 | -$56.0M | -$107.0M |
| Net Change in Cash | $257.0M | -$262.0M | $58.0M | $338.0M | $450.0M |
Analyst Estimates (Annual)
Last updated: Jun 14, 2026 3:00am (13d ago)| Metric | 2026 | 2027 | 2028 | 2029 |
|---|---|---|---|---|
| Revenue |
$7.4B $7.3B – $7.4B
|
$8.7B $8.5B – $8.9B
|
$10.2B $10.2B – $10.2B
|
$12.4B $11.9B – $12.7B
|
| EBITDA |
$2.6B $2.6B – $2.6B
|
$3.1B $3.0B – $3.1B
|
$3.6B $3.6B – $3.6B
|
$4.3B $4.2B – $4.4B
|
| Net Income |
$814.9M $787.6M – $842.2M
|
$1.0B $971.5M – $1.1B
|
$1.3B $980.1M – $1.6B
|
$1.8B $1.7B – $1.8B
|
| EPS | — | — | — | — |
Growth Trends (YoY %)
Last updated: Jun 14, 2026 3:07am (13d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +60.2% | +41.5% | +28.3% | +24.1% |
| Gross Profit Growth | +62.7% | +63.2% | +42.7% | +33.2% |
| Operating Income Growth | -68.4% | +25.3% | +105.6% | +1,806.3% |
| Net Income Growth | +43.5% | +10.5% | +107.7% | +1,700.0% |
| EBITDA Growth | +44.6% | +16.2% | +150.9% | +282.4% |
Insider Trading (Recent)
Last updated: Jun 14, 2026 3:06am (13d ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-06-12 | Bennett Richard Kent | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | Bennett Richard Kent | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Bennett Richard Kent | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Chapman-Hughes Susan | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Chapman-Hughes Susan | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | Chapman-Hughes Susan | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Hawkins Mark J | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Hawkins Mark J | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | Hawkins Mark J | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | PATRICK DEVAL L | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | PATRICK DEVAL L | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | PATRICK DEVAL L | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Koplow Hilarie A. | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | Koplow Hilarie A. | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | Koplow Hilarie A. | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | BELL PAUL D | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | BELL PAUL D | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-06-12 | BELL PAUL D | M-Exempt | 5,256.00 | $0.00 | $0 |
| 2026-06-12 | BHARADWAJ ANUTTHARA | A-Award | 8,888.00 | $0.00 | $0 |
| 2026-05-29 | Elworthy Brian R | M-Exempt | 54,000.00 | $2.21 | $119,340 |
Narrative Economics
market-narrative step).
Delvantic AI Findings
Looking at the raw trajectory first: revenue went $1.24B → $1.31B → $1.34B → $1.34B → $1.55B → $1.63B → $1.63B → $1.63B over eight quarters. That's a clear flattening at $1.63B for three consecutive quarters. The "decelerating" tag in revenue confidence is doing a lot of work here — sequential growth from Q3'25 to Q1'26 was essentially zero. Yes, YoY is still 24%, but the run-rate has stalled at ~$6.5B annualized. Meanwhile net income climbed $80M → $105M → $101M → $126M, so margin expansion is real (5.2% → 7.7% net margin in four quarters) even as top-line plateaus. That's the actual story the models are dancing around: Toast is converting from growth-at-all-costs to operating leverage, and the question is whether the plateau is seasonal/lumpy or structural.
FCF of $608M on $6.15B revenue is a 9.9% FCF margin — genuinely good, and the 2024→2025 swing from $16M operating income to $305M is the kind of inflection that justifies a re-rating. But at $14.4B market cap, EV/FCF is ~21x and P/S is 2.3x trailing / ~2.2x forward. That's not "priced for perfection" — the synthesis is right that this is uncomfortable middle ground, but I'd push harder: at 2.3x sales for a 24%-growing, FCF-positive vertical SaaS with payments attach, this is actually reasonable-to-cheap if the growth holds. The bear case isn't valuation; it's the three-quarter revenue plateau. If Q2'26 prints another $1.63B, the multiple compresses fast because the growth narrative breaks.
The prior models are internally inconsistent in a way worth flagging. Pre-flight calls it "pre-profit-platform" — wrong, Toast made $342M last year. Rule-based says "mature_earner" at 0.45 confidence — also wrong, a mature earner doesn't grow 24% YoY. The narrative layer's "platform-monopoly anchored, moderate intensity" is the most honest read. Synthesis hedges to "High Conviction Required" which is analyst-speak for "I don't know." The insider activity is mostly option exercises with associated sales — routine, not a signal, and the "Neutral" tag is correct. Macro headwinds matter here more than the models emphasize: Toast's customers are restaurants, and restaurant same-store traffic has been soft through 2025; a consumer-led slowdown hits GPV (gross payment volume) directly, which is ~80% of revenue. The contrarian argument writes itself: payments revenue is take-rate × volume, and both can compress simultaneously in a downturn while SaaS ARR keeps growing — meaning the mix-shift to software margins could be masked by payment volume weakness for several quarters.
My read: the synthesis is too noncommittal. At $24.82 with $608M FCF growing, 24% revenue growth even off a plateau-y base, $1.35B cash and no meaningful debt, this is closer to fair-to-slightly-cheap than expensive. A 25x FCF multiple on $700M forward FCF gets you ~$17.5B / ~$30/share; a more aggressive 30x on $800M (if margin expansion continues) gets you ~$24B / ~$41/share. The downside if revenue stalls and FCF flatlines at $600M is maybe 18x = $10.8B / ~$19/share, so risk/reward is roughly +60% vs -25% from here. The thing I'd want to see before sizing up is Q2'26 revenue breaking $1.70B to kill the plateau concern. I dissent from "High Conviction Required" — I'd call this a starter-position buy with the second tranche contingent on the next print. The TTM P/E of 35x looks scary in isolation but is misleading because earnings are inflecting; EV/FCF of ~21x is the cleaner anchor and it's not demanding.
GPT Critique
Toast, Inc. presents a compelling case as a maturing tech company transitioning from rapid growth to profitability while trying to sustain its momentum. The most striking aspect of the raw data is the company's consistent revenue growth, reaching a plateau at $1.63 billion over the past three quarters, which suggests a potential slowdown. The net income increase to $126 million in the latest quarter, with a margin expansion to 7.7%, indicates a successful shift towards improving profitability. The annual figures also reflect a marked improvement, with a leap in operating income to $305 million from a mere $16 million the previous year, showcasing operational leverage. Furthermore, the substantial free cash flow of $608 million on $6.15 billion revenue implies a strong cash-generating capability.
I concur with Opus's assessment that the revenue plateau is pivotal. While Opus highlights the importance of breaking this trend, I perceive it as a risk factor that needs immediate addressing to maintain investor confidence. The narrative of transitioning from a payments processor to a robust SaaS platform is appealing, yet the market's skepticism, reflected in the stock's halved price from its peak, underscores the critical need for sustained growth. Opus notes the insider activity as neutral, and I agree, seeing no red flags there. However, I diverge from Opus's view on the market's pricing, where he sees the stock as modestly undervalued. Given the current macroeconomic headwinds and the cyclical nature of the restaurant industry, which is pivotal for Toast's business, I am more cautious, viewing the potential for revenue compression as a significant risk.
Opus argues that the valuation is reasonable-to-cheap based on a 24% revenue growth rate and $608 million FCF, but I find this overly optimistic. The EV/FCF ratio of ~21x suggests a premium price tag, especially when considering potential growth stagnation. I am skeptical of assigning a 25x or 30x multiple without clear evidence of breaking the revenue plateau. While Opus dismisses the "High Conviction Required" synthesis as noncommittal, I find it prudent, considering the high expectations embedded in current valuations and the potential for the narrative to falter if growth doesn't resume.
A careful skeptic would argue that the current valuation already factors in a successful transition to a high-margin SaaS model, leaving limited upside unless Toast can demonstrate stronger growth, especially in a challenging economic climate. The skeptic would also point to the reliance on the restaurant sector and potential competition as vulnerabilities that could hinder Toast's ability to sustain its trajectory.