Toast Explodes on its NYSE Debut After IPO Valued Company at $20B

Toast, a company whose products are now being used at over 48,000 restaurant locations, made its market debut on the NYSE on Wednesday and surged a whopping 56%.

The IPO valued the restaurant-tech company at $20 billion.

Toast raised about $870 million in its IPO, selling shares at $40 each. The company had previously said it expected to price the offering at $34 to $36, following an initial range of $30 to $33.

The stock closed at $62.51 on Wednesday afternoon, pushing the company’s market cap to over $31 billion.

The promising debut comes after Toast had cut its workforce in 2020, and CEO Chris Comparato wrote in a blog post that “as a result of necessary social distancing and government-mandated closures, restaurant sales declined by 80 percent in most cities.”

Sales for the company had rebounded very quickly as restaurants decided to do takeout and contactless ordering. Eventually outside dining also opened up.

By the third quarter, revenue for Toast was on the upswing and was even higher than a year earlier, before COVID-19 happened.

For all of 2020, the company saw revenue rise 24% to $823.1 million. In the second quarter of this year, revenue almost tripled to $424.7 million.

Comparato told CNBC’s “Squawk on the Street” on Wednesday that he’s optimistic about where restaurants go from here.

“When we look at the delta variant and Covid in general, we feel the industry has been battle tested with the Covid pandemic,” Comparato said. “While delta may dampen things, this industry is in recovery and we couldn’t be more excited to lead the charge ahead as the industry recovers and restaurants start to thrive again.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.