Toast, the restaurant-order software leader, and discount shopping chain Five Below lead this weekend's watch list of stocks near buy points with at least 20% revenue growth. Wealth management platform LPL Financial, Construction Partners, and chipmaker Macom Tech Solutions, which is partly a play on data-center growth, round out the list.
Toast, LPL Financial and Construction Partners all have a 99 IBD Composite Rating out of a possible 99, according to IBD Stock Checkup. The single rating combines both fundamental and technical factors.
IBD Stock Lists, Market Take
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The S&P 500 finished a hair lower on Friday, after ending at an all-time closing high on Thursday. The Nasdaq composite edged up 0.05% to a new record close. For the year, the S&P 500 is up 7.1% and the Nasdaq 8.2%.
The bull market trend is intact, allowing investors to have 80% to 100% exposure. Yet that's subject to change at any time.
Stock Market Getting Extended; What To Do Now
Be sure to read IBD's The Big Picture column after each trading day to get the latest on the prevailing stock market trend and what it means for your trading decisions.
A stock's average true range, a metric available on IBD's MarketSurge, reflects its daily volatility. Higher numbers raise the risk of a shakeout that can trigger sell rules. Current market conditions are conducive for buying stocks with pretty high ATRs of up to 8%, but investors should be wary of being too concentrated in high-octane names.
All of these stocks have relatively modest ATRs.
Toast Stock
Toast was featured as IBD Stock Of The Day on Friday. Its restaurant-software offerings range from point-of-sale hardware, kitchen displays, payment processing, supplier and invoice management to payroll, delivery management, menu consultation and marketing programs.
In resuming coverage with a buy rating and 54 price target on Wednesday, Deutsche Bank analyst Nate Svensson highlighted Toast, along with Affirm Holdings and Shift4 as "companies with strong value propositions that have built out product suites and go-to-market capabilities that we think will result in continued market share gains and long-term success."
Toast announced its largest win yet in April, serving 1,500 Applebee's locations, as well as a Topgolf win. In a Thursday note, Jefferies analyst Samad Samana said more customers wins will be announced in time for Q2 earnings, which FactSet expects on Aug. 12.
Revenue grew 24% from a year ago in Q1, and analysts expect 23% growth in Q2.
TOST stock rose 7.2% to 46.52 last week, breaking out Thursday past a 45.56 buy point from a flat base. Shares had flirted with a breakout multiple times, and suffered several downside reversals, though the 12%-deep base looked tighter on a weekly chart.
Five Below Stock
Five Below revenue growth revved up to 20% in its April fiscal Q1, up from 4% the prior quarter. Growth of 19% is anticipated for Q2, with results expected in late August. New CEO Winnie Park's "efforts to revamp the company's merchandising and marketing strategies" are building confidence that strong comparable-store sales growth could be sustainable, William Blair analyst Phillip Blee wrote after a better-than-expected Q1 report on June 5.
Still, Blee kept a market perform rating for FIVE on tariff risk, noting that China still contributes 50% of the company's product, though that's down from 60% at the end of Q1.
FIVE stock shot up 8.1% last week to 139.07, clearing a 137.30 buy point from an early-stage flat base. That flat base formed after shares more than doubled over two months.
LPL Financial Stock
LPL Financial, whose technology platform and services support over 29,000 financial advisors had $1.85 trillion in advisory and brokerage assets at the end of May, up 26.5% from a year ago. On March 31, LPL announced the acquisition of Commonwealth Financial Network, with $285 billion in assets, with the transaction expected to close in the second half of 2025.
In a June 5 note, William Blair analyst Jeff Schmitt said that he expects LPL's "leading aggregation model to drive high levels of client asset growth over the next several years." Despite the potential headwind of lower interest rates, asset growth and a greater focus on expense management "should drive strong EPS momentum in 2025 an 2026." The first has an outperform rating on LPLA.
Revenue grew 30% in Q1. Estimates point to 29% growth in Q2. LPL Financial reports after the close on July 31.
LPLA rose 3.8% on Friday, clearing a 390.23 buy point from a flat base that forged next to the top of a prior base. LPL Financial staged an upside, outside week, rebounding for a 5.7% gain.
Big, Beautiful Health Care Squeeze Is Here. What That Means For Your Coverage.
Construction Partners Stock
Construction Partners, based in Dothan, Ala., calls itself an asphalt-centered infrastructure company in its corporate presentation, that paved roads require maintenance every 10 years on average. The company says it operates in Sunbelt states with the fastest population growth in the country.
Acquisitions have fueled much of its growth, with eight deals in 2024, including an $878 million cash-and-stock deal for Lone Star Paving. That deal expanded Construction Partners' territory to Texas and Oklahoma.
Revenue from publicly funded projects currently accounts for about 63% of the total.
With the incorporation of Lone Star Paving's financials, Construction Partners' revenue grew 54% in Q2. Estimates call for 57% growth in the June fiscal third quarter. Results are due on Aug. 7.
ROAD stock fell 4.6% to 107.57 on Friday. That reversed much of the prior two days' gains, including a 3.3% move on Thursday, lifting ROAD past a 111.98 flat-base buy point. Shares still rose modestly for the week, finding support at the 21-day line.
Macom Tech Stock
Macom, based in Lowell, Mass., posted 30% revenue growth in its March fiscal second quarter. Revenue from its semiconductor solutions for industrial and defense uses rose 1% sequentially to $98.5 million, data center revenues rose 11% to $72.2 million, and telecom 18% to $65.2 million.
Analysts expect year-over-year revenue growth of 31%. FactSet indicates that Q3 earnings are expected on July 31.
On June 24, BofA raised its price target for MTSI to 160 from 140, citing its "unique growth engines in data center and defense," according to a write-up on The Fly investment site. The analysts expect 45% data center growth for the year.
A July 7 note from Truist analyst William Stein highlighted the firm's optimism over new optical amplifier products for satellite-to-satellite and satellite-to-ground data links. Truist kept a buy rating and hiked its target to 154 from 136.
MTSI has climbed 13% since clearing a buy point from a deep cup-with-handle base on June 13. Yet recently etched out another handle closer to the top of the same cup, with a 144.15 buy point. The rally off of MTSI's 21-day exponential average on Thursday, broke the downtrend in the new handle, flashing an early entry opportunity.
