Restaurant software platform Toast (NYSE:TOST) will be announcing earnings results tomorrow afternoon. Here’s what you need to know.
Toast beat analysts’ revenue expectations by 1.7% last quarter, reporting revenues of $1.34 billion, up 29.2% year on year. It was a very strong quarter for the company, with EBITDA guidance for next quarter exceeding analysts’ expectations.
Is Toast a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Toast’s revenue to grow 25.3% year on year to $1.35 billion, slowing from the 31.3% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.19 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Toast has missed Wall Street’s revenue estimates twice over the last two years.
Looking at Toast’s peers in the vertical software segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Upstart delivered year-on-year revenue growth of 67%, beating analysts’ expectations by 5.2%, and Cadence reported revenues up 23.1%, in line with consensus estimates. Cadence traded up 5.7% following the results.
Read our full analysis of Upstart’s results here and Cadence’s results here.
There has been positive sentiment among investors in the vertical software segment, with share prices up 17% on average over the last month. Toast is up 17.6% during the same time and is heading into earnings with an average analyst price target of $40.96 (compared to the current share price of $35.32).
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