Toast (TOST) Exceeds Market Returns: Some Facts to Consider

Toast (TOST) closed the most recent trading day at $27.73, moving +2.51% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 1.97% for the day. Elsewhere, the Dow gained 2.47%, while the tech-heavy Nasdaq added 2.18%.

The restaurant software provider's stock has dropped by 26.13% in the past month, falling short of the Computer and Technology sector's loss of 3.67% and the S&P 500's loss of 1.49%.

Investors will be eagerly watching for the performance of Toast in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on February 12, 2026. On that day, Toast is projected to report earnings of $0.24 per share, which would represent year-over-year growth of 380%. Meanwhile, our latest consensus estimate is calling for revenue of $1.62 billion, up 21.14% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.04 per share and revenue of $6.14 billion, indicating changes of +3366.67% and +23.77%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for Toast. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. At present, Toast boasts a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Toast has a Forward P/E ratio of 21.76 right now. This indicates a premium in contrast to its industry's Forward P/E of 19.86.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 93, which puts it in the top 38% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.

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Toast, Inc. (TOST): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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