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Toast Altman Z-Score

: 9.52 (As of Today)
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Good Sign:

Altman Z-score of 10.31 is strong.

Toast has a Altman Z-Score of 9.52, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for Toast's Altman Z-Score or its related term are showing as below:

TOST' s Altman Z-Score Range Over the Past 10 Years
Min: 10.31   Med: 16.37   Max: 23.08
Current: 10.31

During the past 3 years, Toast's highest Altman Z-Score was 23.08. The lowest was 10.31. And the median was 16.37.


Toast Altman Z-Score Historical Data

The historical data trend for Toast's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Toast Annual Data
Trend Dec19 Dec20 Dec21
Altman Z-Score
- - 16.37

Toast Quarterly Data
Dec19 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Altman Z-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only - 23.09 16.37 11.45 -

Competitive Comparison

For the Software - Infrastructure subindustry, Toast's Altman Z-Score, along with its competitors' market caps and Altman Z-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Toast Altman Z-Score Distribution

For the Software industry and Technology sector, Toast's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where Toast's Altman Z-Score falls into.



Toast Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Toast's Altman Z-Score for today is calculated with this formula:

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*0.588+1.4*-0.6737+3.3*-0.1879+0.6*15.196+1.0*1.2636
=9.52

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.

Trailing Twelve Months (TTM) ended in Jun. 2022:
Total Assets was $1,750 Mil.
Total Current Assets was $1,486 Mil.
Total Current Liabilities was $457 Mil.
Retained Earnings was $-1,179 Mil.
Pre-Tax Income was -54 + -23 + 0.77 + -252.368 = $-329 Mil.
Interest Expense was 0 + 0 + 0.403 + -0.247 = $0 Mil.
Revenue was 675 + 535 + 514.873 + 486.379 = $2,211 Mil.
Market Cap (Today) was $9,118 Mil.
Total Liabilities was $600 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(1486 - 457)/1750
=0.588

X2=Retained Earnings/Total Assets
=-1179/1750
=-0.6737

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-328.598 - 0.156)/1750
=-0.1879

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=9117.570/600
=15.196

X5=Revenue/Total Assets
=2211.252/1750
=1.2636

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

Toast has a Altman Z-Score of 9.52 indicating it is in Safe Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


Toast  (NYSE:TOST) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


Toast Altman Z-Score Related Terms

Thank you for viewing the detailed overview of Toast's Altman Z-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Toast Business Description

Toast logo
Traded in Other Exchanges
Address
401 Park Drive, Suite 801, Boston, MA, USA, 02215
Toast is a U.S.-based restaurant technology company that provides point-of-sale, payment processing, and various software services to 57,000 restaurant locations across the United States. The firm generates sales from software subscription fees, as a percentage take rate from each financial transaction it processes, and from hardware installation and professional services. Unlike competitors, Toast intermediates every payment transaction on its platform, processing some $57 billion in gross platform volume in 2021. The firm's product offerings span point-of-sale systems, inventory and payroll management, delivery integration, e-commerce ordering, and loyalty programs.
Executives
Grimm Jonathan 10 percent owner, officer: Chief Technology Officer TOAST, INC. 401 PARK DRIVE, SUITE 801 BOSTON MA 02215
Hmi Capital Partners, L.p. 10 percent owner C/O HMI CAPITAL, LLC 555 CALIFORNIA STREET, SUITE 4900 SAN FRANCISCO CA 94104
Hmi Capital Management, L.p. 10 percent owner 555 CALIFORNIA STREET SUITE 4900 SAN FRANCISCO CA 94104
Koplow Hilarie A. director C/O NEW RELIC, INC. 188 SPEAR STREET, STE. 1200 SAN FRANCISCO CA 94105
Matlock James Michael officer: Principal Accounting Officer TOAST, INC. 401 PARK DRIVE, SUITE 801 BOSTON MA 02215
Fmr Llc 10 percent owner, other: See Remark 1 245 SUMMER STREET BOSTON MA 02210
Tcv X Member Fund, L.p. other: May be part of a 13(d) group 250 MIDDLEFIELD ROAD MENLO PARK CA 94025
Technology Investment Dining Group, Llc 10 percent owner 18 BANK STREET LEBANON NH 03766
Bell Paul D director C/O DELL INC. ONE DELL WAY ROUND ROCK TX 78682-2244
Bessemer Venture Partners Century Fund Institutional L.p. 10 percent owner 1865 PALMER AVENUE SUITE 104 LARCHMONT NY 10538
Bessemer Venture Partners Century Fund L.p. 10 percent owner 1865 PALMER AVENUE SUITE 104 LARCHMONT NY 10538
Papa Steve 10 percent owner C/O DESKTOP METAL, INC. 63 THIRD AVENUE BURLINGTON MA 01803
Bennett Richard Kent director 1865 PALMER AVENUE SUITE 104 LARCHMONT NY 10538
Comparato Christopher P director, officer: Chief Executive Officer TOAST, INC. 401 PARK DRIVE, SUITE 801 BOSTON MA 02215
Fredette Stephen director, officer: Co-President TOAST, INC. 401 PARK DRIVE, SUITE 801 BOSTON MA 02215

Toast Headlines

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