The restaurant technology industry is experiencing significant growth and transformation, driven by advancements in Artificial Intelligence (AI), automation, and digital solutions. Given the industry’s tailwinds, investors could consider keeping track of fundamentally sound restaurant tech stocks, DoorDash, Inc. (DASH), Toast, Inc. (TOST), and Olo Inc. (OLO), which are changing how we dine.
The restaurant digitalization market is rapidly growing due to rising consumer demand for convenience and efficiency and restaurant owners' need for cost-effective solutions. These technologies help restaurants improve customer satisfaction, adjust to market changes, and lower operational expenses.
Hence, the global restaurant digitalization market is expected to grow at a CAGR of 16.7% by 2033. Moreover, growing advancements in technology and the rising adoption of artificial intelligence, virtual assistants, the Internet of Things, and cloud-based solutions in restaurants allow owners to deliver the best customer services that could engage customers for longer durations.
Considering these encouraging trends, let’s take a look at the fundamentals of the three best restaurant tech stocks.
DoorDash, Inc. (DASH)
DASH operates a commerce platform that connects merchants, consumers, and independent contractors in the United States and internationally.
DASH’s trailing-12-month gross profit and levered FCF margins of 48.31% and 16.91% are 28.3% and 273.9% higher than the respective industry averages of 37.66% and 4.52%.
DASH’s revenue for the fourth quarter that ended December 31, 2024, was reported at $2.30 billion. Its non-GAAP gross profit came in at $1.47 billion, up 31.8% from the year-ago quarter. The company reported adjusted EBITDA of $566 million, up 55.9% from the prior-year quarter.
Analysts expect DASH’s revenue for the fiscal first quarter ending March 2025 to increase 23.2% year-over-year to $3.09 billion. Street expects its EPS to increase 50.2% year-over-year to $0.99 for the same quarter. The company surpassed its revenue estimates in each of the trailing four quarters, which is promising.
DASH’s stock has soared 77.8% over the past year to close the last trading session at $213.38.
DASH’s POWR Ratings reflect its positive outlook. It has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
The stock has an A grade for Growth and a B for Quality. It is ranked #9 in the 25-stock Internet - Services industry.
Beyond what is stated above, we’ve also rated DASH for Value, Momentum, Stability, and Sentiment. Get all DASH ratings here.
Toast, Inc. (TOST)
TOST operates a cloud-based digital technology platform for the restaurant industry in the United States, Ireland, and India.
TOST’s trailing-12-month asset turnover ratio of 2.29x is 944.1% higher than the industry average of 0.22x.
During the third quarter that ended September 30, 2024, TOST’s total revenue rose 26.4% year-over-year to $1.31 billion, and its gross profit grew 42.5% year-over-year to $322 million. The company’s net income came in at $56 million and $0.07 per share, compared to a net loss of $31 million and $0.09 per share in the previous-year quarter, respectively.
Street expects TOST’s revenue and EPS for the year (ending December 2025) to increase 23.5% and 45.2% year-over-year to $6.09 billion and $0.89, respectively. Moreover, the company topped the consensus revenue estimates in all four trailing quarters, which is impressive.
TOST’s stock has increased 49.1% over the past nine months and 100.9% over the past year to close the last trading session at $40.49.
TOST’s POWR Ratings reflect prospects. TOST has an A grade for Growth and a B for Sentiment. It is ranked #26 among 40 stocks in the B-rated Software - Business industry.
In addition to the POWR Ratings highlighted above, one can access TOST’s ratings for Momentum, Stability, Value, and Quality here.
Olo Inc. (OLO)
OLO operates an open SaaS platform for restaurants in the United States. The company's platform enables on-demand digital commerce operations, which cover digital ordering, delivery, front-of-house management, and payments.
On February 4, 2025, OLO announced a new partnership with FreedomPay, an innovative Next Level Commerce technologies leader, to improve restaurant payment experiences nationwide. The partnership also deepens OLO’s relationship with Stripe, a financial infrastructure platform for businesses, which will include in-person transaction processing.
OLO’s trailing-12-month gross profit margin of 56.11% is 12.1% higher than the industry average of 50.08%.
During the third quarter that ended September 30, 2024, OLO’s total revenue rose 24% year-over-year to $71.85 million, and its gross profit grew 12.9% year-over-year to $39.01 million. Furthermore, the company’s non-GAAP net income and net income per common share came in at $10.39 million and $0.06, up 37.4% and 50% year-over-year, respectively.
Street expects OLO’s revenue and EPS for the fourth quarter (ended December 2024) to increase 15.5% and 33.3% year-over-year to $72.76 million and $0.07, respectively. Moreover, the company topped the consensus EPS and revenue estimates in all four trailing quarters, which is impressive.
OLO’s stock has increased 49.2% over the past nine months and 22.1% over the past year to close the last trading session at $7.25.
OLO’s strong fundamentals are reflected in its POWR Ratings. OLO has a B grade for Growth and Sentiment. It is ranked #13 out of 18 stocks in the Software - SAAS industry.
Click here for the additional OLO ratings (Quality, Momentum, Stability, and Value).
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DASH shares were unchanged in premarket trading Monday. Year-to-date, DASH has gained 27.20%, versus a 4.03% rise in the benchmark S&P 500 index during the same period.
About the Author: Nidhi Agarwal
Nidhi is passionate about the capital market and wealth management, which led her to pursue a career as an investment analyst. She holds a bachelor's degree in finance and marketing and is pursuing the CFA program. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.
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