Top 10 Stocks to Buy According to Durable Capital Partners

5. Toast, Inc. (NYSE:TOST)

Number of Hedge Fund Holders as of Q4: 63

Durable Capital Partners’ Equity Stake: $562.94 Million 

Toast, Inc. (NYSE:TOST), headquartered in Boston, Massachusetts, is a cloud-based restaurant management software company offering an integrated point-of-sale (POS) system designed for the food service industry. Operating on the Android platform, the company’s comprehensive management system includes devices such as the Flex terminal, Tap payment processor, Toast Hub, and receipt printer. Since its launch in March 2020, the company has expanded rapidly, serving a growing number of restaurant locations with its digital solutions tailored to streamline operations and enhance efficiency.

For the fourth quarter of 2024, Toast, Inc. (NYSE:TOST) reported strong financial performance, marking a record-breaking year for the company. As of December 31, 2024, annual recurring revenue (ARR) reached $1.6 billion, reflecting a 34% year-over-year increase. The total number of locations utilizing its platform grew by 26% to approximately 134,000, while gross payment volume (GPV) surged 25% to $42.2 billion. The company’s GAAP income from operations stood at $32 million for the quarter, a significant improvement from a $56 million loss in the prior year. Similarly, GAAP net income rose to $33 million, compared to a net loss of $36 million in the same period of 2023. Adjusted EBITDA soared to $111 million, nearly quadrupling from $29 million in the previous year’s quarter, demonstrating robust profitability.

For the full year 2024, Toast, Inc. (NYSE:TOST) maintained strong growth momentum, with GPV increasing 26% to $159.1 billion. The company’s subscription services and financial technology gross profit rose 34% to $1.4 billion and adjusted EBITDA jumped to $373 million from $61 million in 2023. Net cash from operating activities more than doubled to $360 million, while free cash flow surged to $306 million. Looking ahead to the first quarter of 2025, Toast anticipates continued strong performance, projecting non-GAAP gross profit between $385 million and $395 million and adjusted EBITDA in the range of $100 million to $110 million. With its expanding customer base and consistent financial improvements, Toast, Inc. (NYSE:TOST) is well-positioned for sustained growth in the restaurant technology sector.