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Investing.com - Truist Securities raised its price target on Toast Inc. (NYSE:TOST) to $51.00 from $50.00 on Wednesday, while maintaining a Buy rating on the restaurant technology company. According to InvestingPro data, Toast’s stock has delivered an impressive 78% return over the past year, with the company currently trading near its 52-week high of $49.66.
The price target adjustment follows Toast’s strong second-quarter earnings report, with Truist citing expectations for faster recurring gross profit growth in coming years despite some near-term margin adjustments. The company has demonstrated solid financial performance, with revenue growing at 26% and maintaining a healthy current ratio of 2.59, according to InvestingPro data.
Truist slightly reduced its adjusted EBITDA forecasts for Toast to $591 million from $611 million for 2025 and to $838 million from $849 million for 2026, accounting for the company’s plans to increase distribution-related growth investments in the second half of 2025.
The firm also factored in a conservative approach to potential tariff impacts, assuming the average cost of hardware sold in 2026 will increase by 15%, but noted these near-term margin pressures would be offset by faster recurring gross profit growth.
The new $51 price target implies a 49x multiple on Truist’s 2026 estimated adjusted free cash flow, compared to expectations for 43% year-over-year FCF growth in 2027, representing a 1.2x growth-adjusted ratio.
In other recent news, Toast Inc. has seen a series of analyst upgrades and increased price targets following its strong second-quarter performance. Bernstein SocGen raised its price target to $48, citing the addition of 8,500 new locations and a steady performance. RBC Capital also increased its target to $50, highlighting Toast’s strong annual recurring revenue growth and record net location additions. JPMorgan followed suit with a new target of $52, noting better-than-expected recurring gross profit and EBITDA metrics. Needham set the highest target at $60, praising Toast for exceeding Q2 expectations and providing strong guidance for the third quarter and full-year 2025. Goldman Sachs maintained a Neutral rating with a $51 target, acknowledging the company’s robust performance in its software and payments segments. Toast’s recent quarterly results have consistently exceeded expectations, leading to a positive outlook from multiple financial firms. These developments indicate significant growth and potential for the company in the coming quarters.
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