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TOST shares are trading more than 2% higher on Wednesday, above the $15 per share mark.
The analysts stated that top-line momentum is slowing for the company as competition intensifies.
“Shares have lagged significantly since the 3Q print, and we see risks which could inhibit near-term re-rating higher,” wrote the analysts. “Aside from uncertain macro/restaurant spending trends, we believe TOST faces intensifying competition from the likes of SQ, FI (Clover), and FOUR.
The analysts believe those companies have been narrowing the gaps in product and distribution.
Despite the potential headwinds, BofA continues to believe TOST’s products and technology are solid but that its sales strategy transition could take time to translate to meaningful SaaS ARPU growth re-acceleration.
