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Investing.com - Goldman Sachs has reiterated its Neutral rating on Toast Inc. (NYSE:TOST) with a price target of $51.00, following the company’s quarterly performance. According to InvestingPro data, Toast’s stock has surged nearly 97% over the past year, though current analysis suggests the stock is trading above its Fair Value.
The financial services firm noted that Toast delivered "another strong beat and raise," showing upside in both its software and payments segments. With revenue growth of 26.7% and a healthy current ratio of 2.51, Toast’s financial metrics support this positive assessment. Goldman Sachs identified several positive factors, including potential understatement of the company’s performance due to Toast Capital demand disruption earlier in the quarter.
Additional positive elements highlighted in the analysis include potential pricing tailwinds, momentum in new growth verticals, and better-than-expected gross payment volume (GPV) per location metrics.
Despite these strengths, Goldman Sachs expressed concerns that rapid growth in new verticals likely indicates peak core net additions. The firm also warned that tariff-related impacts would likely become more of a headwind for Toast in 2026.
Goldman Sachs concluded that the "range of outcomes on valuation" appears "more skewed to the downside over time" if investors observe signs of deceleration, leading the firm to "remain on the sidelines for a better entry point."
In other recent news, Toast Inc. reported its Q2 2025 earnings, which revealed a mixed performance. The company missed its earnings per share (EPS) expectations, posting $0.13 against a forecasted $0.22, resulting in a 40.91% negative surprise. However, Toast exceeded revenue projections, generating $1.55 billion compared to the anticipated $1.52 billion. Despite the earnings miss, the revenue outperformance highlights the company’s robust sales growth. Analysts from various firms have taken note of these developments, with some adjusting their outlooks on the company’s future performance. The earnings results have sparked discussions among investors regarding the company’s financial health and growth trajectory. These recent developments provide a comprehensive view of Toast’s current financial standing and market position.
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