Shares of Toast (NYSE: TOST) opened Friday's trading session 17.8% above Thursday's closing price, boosted by a strong third-quarter earnings report. The provider of cloud-based management tools for restaurant owners cooled down a bit later in the day, trading at a 12.6% gain by 12:15 p.m. ET. All told, Toast investors have pocketed a 147% return in 52 weeks.

Toast's Q3 surprise, by the numbers

Your average analyst had expected third-quarter earnings of roughly $0.01 per share on top-line sales near $1.29 billion. Toast smashed the earnings target with a result of $0.07 per share. Revenues landed just above the analyst benchmark at $1.31 billion.

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The company added 7,000 net new customer locations in the third quarter, adding up to a client network of 127,000 restaurants. "We are just getting started," CEO Aman Narang said in a prepared statement, boosting his fourth-quarter projections for subscription service growth and adjusted profits.

Expansion plans and premium stock prices

On the earnings call, Narang noted that Toast has achieved 14% market penetration so far, leaving plenty of room for continued growth in North America.

"Our customers continue to choose Toast as they expand locations, solidifying our position in the market as a choice for growing successful restaurants," he said. Several customer examples highlighted how Toast helps restaurant managers save time and money on important day-to-day functions.

It's no surprise to see Toast gain clients by word-of-mouth marketing, given these user-friendly stories. And it's not just hot air -- Toast backs up its bullish talk with great financial results.

The stock isn't cheap, trading at 48 times forward earnings estimates. However, investors pay a premium for a high-quality growth opportunity. Toast has earned its lofty valuation ratios the hard way.

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