Evercore ISI said Toast’s recent exit created a more attractive risk-reward setup. The investment firm upgraded the restaurant management software stock’s rating from Inline to Outperform. Analyst Adam Frisch’s $40 price target suggests a 19% upside from Toast stock’s Friday closing price. Toast shares have declined 12% over the past 12 months, creating an attractive buying opportunity for Toast, Frisch said. TOST 1Y Mountains TOST 1Y Chart “EV/EBITDA is down 44% from August highs, which in our view discounts near-term incremental U.S. upside and slowing recurring (gross profit) growth,” the analysts wrote. “We could get some modest multiple expansion based on higher forecasts. The risk/reward for the stock looks much more biased to the upside on the 12-month outlook, but before Q4 print There will be some volatility later on (we expect up to 15%),” Evercore ISI said, with the long-term theme remaining intact, with 2026 set to be a transition year until growth re-accelerates from 2027 onwards. Frisch also expects average revenue per user and EBITDA growth to improve over the next few years. Frisch noted that restaurant operating conditions continue to improve, rising to the highest level since 2023. “While we still believe that the majority of new growth vectors will come from overseas, corporate and retail are lagging behind given longer sales cycles and product development requirements,” the analyst said.
