Toast Inc. (TOST) Shares: Cheap or Risky?

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Toast Inc. (NYSE:TOST) saw an upside of 7.56% to close Monday at $22.34 after adding $1.57 on the day. The 5-day average trading volume is 4,528,340 shares of the company’s common stock. It has gained $22.36 in the past week and touched a new high 3 times within the past 5 days. An average of 3,759,255 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 5,612,868.

TOST’s 1-month performance is 26.93% or $4.72 on its low of $16.73 reached on 12/27/22. The company’s shares have touched a 52-week low of $11.91 and high of $30.60, with the stock’s rally to the 52-week high happening on 01/23/23. YTD, TOST has achieved 23.90% or $4.31 and has reached a new high 7 times. However, the current price is down -26.99% from the 52-week high price.

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Insider Transactions

TOST stock investors last saw insider trading activity on Jan 19.Comparato Christopher P (Chief Executive Officer) most recently sold 128,947 shares at $19.42 per share on Jan 19. This transaction cost the insider $2,504,438. Chief Executive Officer, Comparato Christopher P, sold 33,333 shares at a price of $19.43 on Jan 19. Then, on Jan 17, Principal Accounting Officer Matlock James Michael sold 453 shares at a price of $20.25 per share. This transaction amounted to $9,171.

Valuation Metrics

Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 4.36 while the price-to-book (PB) in the most recent quarter is 10.25.

Toast Inc.’s quick ratio for the period ended June 29 was 2.90, with the current ratio over the same period at 3.10. In terms of profitability, the gross margin trailing 12 months is 17.30%. The firm’s gross profit as reported stood at $314.0 million against revenue of $1.71 billion.

Earnings Surprise

For the quarterly period ending June 29 this year, Toast Inc.’s cash and short-term investments amounted to $409.0 million against total debt of $92.0 million. Net income and sales went up compared to those figures reported in the previous quarter. Net income shrunk -157.65% to -$98.0 million, while revenue of -$54.0 million was 44.9% off the previous quarter. Analysts expected TOST to announce -$0.12 per share in earnings in its latest quarter, but it posted -$0.08, representing a 33.30% surprise. EBITDA for the quarter stood at more than -$67.0 million. TOST stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 622.0 million, with total debt at $92.0 million. Shareholders hold equity totaling $520.74 million.

Let’s look briefly at Toast Inc. (TOST) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 23 January was 75.19% to suggest the stock is trending Overbought, with historical volatility in this time period at 54.07%.

The stock’s 5-day moving average is $20.57, reflecting a +12.20% or $2.43 change from its current price. TOST is currently trading +25.72% above its 20-day SMA, +19.53% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 by +17.58% and SMA200 by+5.43%.

Stochastic %K and %D was 83.82% and 78.79% and the average true range (ATR) pointed at 1.12. The RSI (14) points at 69.22%, while the 14-day stochastic is at 99.63% with the period’s ATR at 1.08. The stock’s 9-day MACD Oscillator is pointing at 0.81 and 1.61 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Toast Inc. (NYSE: TOST), Wolfe Research launched coverage with a Peer perform rating. Analysts offering their rating for TOST stock have a consensus rating for the stock as Overweight. Currently, 1 brokerage advisors rate TOST as a “sell,”, while 7 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 2 rates the stock as overweight while 10 have offered a “buy” rating.

What is TOST’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $18.00 and a high of $32.00, with their median price target at $25.00. Looking at these predictions, the average price target given by analysts is for Toast Inc. (TOST) stock is $24.22.

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