What Bernstein Thinks Has Already Played Out at Toast (TOST) Farooq Fri, November 13, 2026 at 4:09 PM EST 4 min read TOST +2.95% ^GSPC -0.40% ^IXIC -0.91% CL=F +0.32% ^DJI +0.10% Trade Toast on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
We just published a list of the Sell Alert: 10 Stocks Analysts Downgraded on Wednesday and Toast (NYSE:TOST) ranked 6th on this list.
Wall Street got a sharp reminder this month of how fast sentiment can turn. Last Thursday the S&P 500 lost 4.4%, its worst day since April 2025, after midterm election results raised fears that regulation could hurt the AI trade. The Nasdaq Composite fell into correction territory, roughly 11% below the record it set in early October.
A rally on lower oil prices offered some relief at the start of this week. Then inflation data reopened the wound. Consumer prices rose 0.4% in October, the third straight monthly gain of at least that size and a touch above the 0.3% economists had expected. The stock market was still nervous from the prior week's rout, and it showed. The S&P 500 fell 0.38% to 7,520.93, the Dow lost 0.30% and the Nasdaq Composite slid 0.74% on the news.
Federal Reserve Governor Christopher Waller said the central bank should raise interest rates in December and consider a half-point increase if inflation worsens. Dallas Fed President Lorie Logan went further, saying at least two more quarter-point hikes are needed to bring prices under control. Three straight monthly gains of 0.4% or more is the kind of streak that keeps rate-hike talk alive.
Traders have taken the message seriously. They now price roughly an 84% chance of a quarter-point December hike, after a week in which both the stock and bond markets swung hard.
Investors tracking how far some AI stocks have fallen can find more names in our ranking of oversold AI stocks that analysts see rebounding by more than half.
Technology shares have taken the brunt of it. Selling in semiconductor stocks reached its most extreme level since 2019 earlier this week, by Yahoo Finance's measure, as worries about regulation of the AI trade added to the pressure.
Wednesday brought a rebound. The S&P 500 climbed 1.31% to 7,619.38, the Nasdaq Composite gained 1.60%, and the Dow rose 0.49%. The Nasdaq Composite had slipped into correction territory only days earlier. One day of gains does not erase the damage from the prior week, and the inflation and rate questions behind the selloff are still open. The Dow finished the day at 52,486.49.
Investors comparing cheaper alternatives can start with our roundup of affordable stocks that Wall Street analysts favor.
For now, the Federal Reserve's December meeting is the date traders are watching, with a hike priced as the likely outcome.
Toast made it to our list because it has an average upside potential of 14%. Bernstein analyst Harshita Rawat downgraded Toast to Market Perform from Outperform on November 11 and lowered her price target to $38 from $45. Rawat says one of the biggest reasons behind Bernstein's February upgrade has already played out: the view that Toast would be an AI winner rather than a loser. She is now watching competition and the cost of growth more closely, and she called the chief financial officer's coming exit not ideal.
Toast sells point-of-sale software and payment processing to restaurants. Its third-quarter report still looked solid, with new locations added, new AI products called Toast IQ Grow and Toast IQ Team, and a raised full-year outlook. Rawat's February upgrade had come after software and fintech stocks de-rated sharply. The shares slid after the report, though, because annualized recurring revenue growth eased to 24% from 26% two quarters earlier.
Chief Financial Officer Elena Gomez is stepping down, and Michael Senno is set to succeed her. Analyst price targets on the stock still span a wide range, a sign that views remain divided. For more on the software push, see our look at whether Toast can defend its software upsell.
While we acknowledge the risk and potential of TOST as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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