Motley Fool Money Two Growth Stories
Aug 8, 2024
Tim Beyers, an investment analyst known for his tech expertise, and Mary Long, a senior analyst focused on investment strategies, dive into intriguing growth stories. They discuss Toast’s ambitious expansion into grocery and liquor sectors despite market skepticism. Shopify’s stellar financial surge, showcasing a 250% jump in free cash flow, is also explored. The conversation shifts to the importance of crafting a clear investment thesis to navigate volatile markets, emphasizing clarity and simplicity in analysis.
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Toast's Growth
- Toast's growth is impressive with 8,000 new locations and positive operating income.
- Annualized recurring revenue increased by 30%, reaching $1.5 billion.
Toast's Profitability Strategy
- Toast focuses on core profitability, aiming for a 30-35% margin.
- They strategically operate at a loss initially to gain long-term profits.
Market Undervaluation of Toast
- The market undervalues Toast, ignoring their profitability metrics.
- This presents a buying opportunity for investors who believe in Toast's potential.