Summary: Bernstein SocGen Group reiterated an Outperform rating and a $39.00 price target on Toast Inc. (NYSE:TOST) on Friday, indicating roughly 49% upside from the stock's prevailing quote of $26.14. The research note, authored by analyst Harshita Rawat, emphasized both recent share-price weakness and the firm's view of Toast as a high-quality name within the Payments sector.
Rawat pointed to a series of headwinds that have pressured Toast's equity performance: the stock has declined 26% year-to-date and more than 34% over the prior 12 months, reflecting what the note describes as broad de-rating across software names and fintechs, in addition to some competitive concerns. Toast is trading close to its 52-week low of $25.91 and has recorded particularly sharp losses - a 41% drop - over the past six months.
Despite those trends, Bernstein SocGen Group characterizes Toast as "one of the highest quality names to own within the Payments sector" and underscores the company's "unusual software moat within the traditionally competitive restaurant payments space." Toast's product set is described in the note as a cloud-based restaurant management platform that integrates point-of-sale, digital ordering, and payment processing for restaurants.
Institutional data cited in the research note suggests Toast may be slightly undervalued at current prices and that its financial position is robust. InvestingPro figures referenced by the research show a strong financial health rating and a current ratio of 2.74, indicating liquid assets exceed short-term liabilities. The note also reports that analysts maintain a consensus "Buy" recommendation on the stock.
Recent company results present a mixed picture. In its fourth-quarter 2025 report, Toast posted earnings per share of $0.16, below the expected $0.24 - a 33.33% negative surprise. Conversely, revenue outperformed estimates, with $1.63 billion reported versus the $1.62 billion forecast. Even with the revenue beat, the shares reacted negatively in aftermarket trading, illustrating investor sensitivity to earnings-per-share outcomes alongside top-line performance.
Bernstein SocGen's reiterated rating and price target reflect a view that, notwithstanding recent market-driven derating and competitive questions, Toast's integrated software offering and liquidity profile warrant an Outperform stance. The research note points investors to additional proprietary research tools for deeper financial analysis.
Key points
- Bernstein SocGen Group reaffirmed an Outperform rating and $39.00 price target for Toast, implying roughly 49% upside from $26.14.
- Shares have fallen 26% year-to-date, more than 34% over the last year, and about 41% over the past six months, trading near a 52-week low of $25.91.
- Toast is described as having an "unusual software moat" in restaurant payments and shows a healthy current ratio of 2.74, with analysts maintaining a consensus Buy.
Risks and uncertainties
- Ongoing de-rating in the software sector and within fintechs has contributed to substantial share-price declines - a market-risk factor for investors in payments and software names.
- Competitive pressures in the restaurant payments space were cited by the analyst note as a concern that may weigh on future performance and valuation.
- Quarterly earnings volatility: Q4 2025 EPS missed expectations by 33.33% despite a revenue beat, and such mixed results have prompted negative aftermarket stock reactions.