Toast's revenue growth and profitability should eventually lift its shares, but stock compensation has diluted shareholders despite those gains. Revenue has grown 250% since the IPO; shares outstanding rose from 502.5 million to 578 million, or 15%, with an estimated $2.4-3 billion in stock compensation. Management needs to deliver a 30% net profit margin ASAP to prove it can turn revenue growth into earnings for shareholders. Buybacks are now reducing the share count, which should help a lot. … Show more

Toast looks cheap against its earnings at 21x next year's estimates, versus the roughly 40x software companies usually get. Applying 40x to next year's $1.73 EPS, give or take 12%, gives a fair value of $60.93-$77.54, leaving the $36.30 price about 40% below where fair starts. The read leans on forecasts, with forward earnings 119% above trailing, and is based on valuation levels only, not fundamental work. x.com 

Toast no longer looks like a business that is accelerating or inflecting higher. Growth appears to be stabilizing around the low-20% range, with a real risk that it moderates further, which justifies exiting despite a year spent defending the thesis and redeploying the capital to other opportunities. x.com 

Toast is worth at least $40 because its proven vertical playbook leaves room to double its 20% share of US SMB and mid-market restaurants. It is expanding into food and beverage retail and abroad, and over half its locations adopted the Toast IQ AI assistant within four months. 2025 revenue rose 24% to $6.15B, ARR 26% to $2.05B, GAAP net income hit $342M and free cash flow $608M. Risks include competition, SMB exposure, lending credit risk and memory costs on hardware. x.com