Toast Receives 'Buy' Rating from Deutsche Bank with $54 Price Target

Deutsche Bank reinstates coverage of Toast (TOST) with a "Buy" rating and a price target of $54.00. This positive outlook comes alongside renewed analyst interest in the company, which continues to make strides in the marketplace. The average target price for Toast Inc is $44.21, with a high estimate of $55.00 and a low estimate of $28.11. The average target implies a 2.91% downside from the current price.

In a significant move, Deutsche Bank has upgraded Toast (TOST) to a Buy rating with a new price target of $54.00. This upgrade reflects a broader reassessment within the payments, processors, and IT services sectors by the bank, which has resumed coverage on 25 stocks. The analyst's shift comes amidst a cautious market outlook, where these industries have not kept pace with the S&P 500 Index so far this year.

Wall Street analysts forecast an average target price of $44.21 for Toast Inc (TOST), with a high estimate of $55.00 and a low estimate of $28.11. The consensus recommendation from 28 brokerage firms is currently 2.3, indicating an "Outperform" status. Based on GuruFocus estimates, the estimated GF Value for Toast Inc (TOST) in one year is $38.25, suggesting a downside of 17.95% from the current price of $46.62.

Toast Inc (TOST) reported strong growth in Q1 2025, with over 6,000 net locations added, bringing the total to approximately 140,000 locations, a 25% increase year over year. Adjusted EBITDA grew to $133 million, with margins expanding 13 percentage points to 32%. Key business developments include marquee wins with large enterprises like Applebee's and Topgolf, and the introduction of AI-driven tools like sous chef and ToastIQ to enhance customer experience and operational efficiency.

However, the company faces challenges such as a dynamic macroeconomic environment, potential pressure on transaction volumes due to a 3% year-over-year decrease in GPV per location, and competition from partners like DoorDash. Additionally, tariff-related hardware expenses are expected to be slightly higher, impacting cost structures.

Jefferies has also increased its price target for Toast (TOST) from $50 to $54, maintaining a Buy rating on the stock. The firm is optimistic about Toast's potential to exceed expectations, citing steady consumer spending patterns and effective execution of the company's growth strategies.

[1] https://www.gurufocus.com/news/2983241/deutsche-bank-upgrades-toast-tost-to-buy-with-new-price-target-tost-stock-news
[2] https://www.gurufocus.com/news/2986369/jefferies-boosts-target-price-for-toast-tost-amid-strong-growth-prospects--tost-stock-news?mod=mw_quote_news&r=4bf001661e6fdd88d0cd7a5659ff9748