Toast Inc. (TOST) is looking forward to a strong quarter

Toast Inc. (NYSE: TOST) stock jumped 7.73% on Friday to $20.77 against a previous-day closing price of $19.28. With 3.01 million shares changed hands, the volume of the stock remained lighter than its average volume of 5.56 million shares. During the session, the Software – Infrastructure company that operates in wider Technology sector, reached to the highest price of $20.87 whereas the lowest price it dropped to was $19.43. The 52-week range on TOST shows that it touched its highest point at $30.60 and its lowest point at $11.91 during that stretch. It currently has a 1-year price target of $24.43.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of TOST was up-trending over the past week, with a rise of 6.24%, but this was up by 16.88% over a month. Three-month performance surged to 7.12% while six-month performance rose 36.64%. The stock lost -14.17% in the past year, while it has gained 15.20% so far this year. A look at the trailing 12-month EPS for TOST yields -0.34 with Next year EPS estimates of -0.36. For the next quarter, that number is -0.13. This implies an EPS growth rate of -92.60% for this year and 18.20% for next year.

Float and Shares Shorts:

At present, 513.72 million TOST shares are outstanding with a float of 309.94 million shares on hand for trading. On Oct 13, 2022, short shares totaled 14.72 million, which was 2.85% higher than short shares on Sep 14, 2022. In addition to Mr. Christopher P. Comparato as the firm’s Chairman, CEO & Director, Mr. Stephen Fredette serves as its Co-Founder, Co-Pres & Director.

Institutional Ownership:

Through their ownership of 74.17% of TOST’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 9.34% of TOST, in contrast to 36.49% held by mutual funds. Shares owned by individuals account for 32.77%. As the largest shareholder in TOST with 8.14% of the stake, The Vanguard Group, Inc. holds 27,203,910 shares worth 27,203,910. A second-largest stockholder of TOST, T. Rowe Price Associates, Inc., holds 26,759,089 shares, controlling over 8.00% of the firm’s shares. HMI Capital Management LP is the third largest shareholder in TOST, holding 15,787,586 shares or 4.72% stake. With a 5.90% stake in TOST, the T Rowe Price New Horizons Fund is the largest stakeholder. A total of 19,719,227 shares are owned by the mutual fund manager. The American Funds AMCAP Fund, which owns about 3.33% of TOST stock, is the second-largest Mutual Fund holder. It holds 11,140,082 shares valued at 200.86 million. Vanguard Total Stock Market Index holds 2.73% of the stake in TOST, owning 9,138,626 shares worth 164.77 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for TOST since 20 analysts follow the stock currently. There are 10 analysts who recommend BUY ratings, while 1 suggest SELL ratings. Of the remaining analysts, 7 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With TOST analysts setting a high price target of $32.00 and a low target of $18.00, the average target price over the next 12 months is $24.22. Based on these targets, TOST could surge 54.07% to reach the target high and fall by -13.34% to reach the target low. Reaching the average price target will result in a growth of 16.61% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. TOST will report FY 2022 earnings on 02/13/2024. Analysts have provided yearly estimates in a range of $0.03 being high and -$0.28 being low. For TOST, this leads to a yearly average estimate of -$0.14. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Toast Inc. surprised analysts by $0.04 when it reported -$0.04 EPS against a consensus estimate of -$0.08. The surprise factor in the prior quarter was $0.01. Based on analyst estimates, the high estimate for the next quarter is -$0.03 and the low estimate is -$0.06. The average estimate for the next quarter is thus -$0.05.

Summary of Insider Activity:

Insiders traded TOST stock several times over the past three months with 29 Buys and 31 Sells. In these transactions, 9,163,806 shares were bought while 10,044,734 shares were sold. The number of buy transactions has increased to 88 while that of sell transactions has risen to 100 over the past year. The total number of shares bought during that period was 44,330,463 while 40,634,736 shares were sold.

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