Krispy Kreme (NASDAQ:DNUT) Stock Falls 15.5% - Time to Sell?

Key Points

• Krispy Kreme shares fell 15.5% to about $3.89 in Friday’s midday trading, despite reporting quarterly results above analyst expectations.
• Third-quarter adjusted EPS was $0.06 and revenue was $328.76 million, both topping estimates; the company also raised its 2026 revenue outlook as it described progress in its turnaround.
• Challenges remain: revenue declined 12.4% year over year and the company posted a negative net margin. Analysts’ average rating is “Reduce,” with an average price target of $4.33.

Krispy Kreme, Inc. (NASDAQ:DNUT - Get Free Report)'s stock price dropped 15.5% during mid-day trading on Friday. The stock traded as low as $3.92 and last traded at $3.8850. 1,144,198 shares were traded during mid-day trading, a decline of 57% from the average daily volume of 2,666,553 shares. The stock had previously closed at $4.60.

Key Headlines Impacting Krispy Kreme

Here are the key news stories impacting Krispy Kreme this week:

• Positive Sentiment: Third-quarter adjusted earnings were $0.06 per share, above analyst estimates, while revenue of $328.76 million also topped expectations. The company raised its 2026 revenue outlook, saying its turnaround is progressing. Krispy Kreme Raises Revenue Outlook as Turnaround Takes Hold
• Positive Sentiment: The asset-light shift may improve the business’s economics: franchisees generated 42% of systemwide sales in Q3, and year-to-date capital expenditures fell 65% to $28.6 million. Krispy Kreme: 3 Key Takeaways for Long-Term Investors
• Neutral Sentiment: The new holiday doughnut collection, including a Ghirardelli hot-cocoa-inspired flavor, could support seasonal interest, though its financial impact is unclear. Krispy Kreme Just Turned Ghirardelli Hot Cocoa Into a Doughnut
• Negative Sentiment: Revenue was down 12.4% from a year earlier, and the company remained unprofitable, with a negative net margin. Those figures underscore that the turnaround has not yet resolved the underlying operating challenges.
• Negative Sentiment: Traders bought 4,003 DNUT put options, about 23% above the average daily volume. This may indicate increased hedging or bearish caution, although options activity alone does not establish a market direction.

Analyst Ratings Changes

DNUT has been the subject of a number of recent research reports. Weiss Ratings downgraded Krispy Kreme from a "sell (d-)" rating to a "sell (e+)" rating in a research note on Friday, October 16th. Evercore set a $4.00 price objective on shares of Krispy Kreme in a research note on Friday, August 7th. Wall Street Zen downgraded shares of Krispy Kreme from a "hold" rating to a "sell" rating in a report on Saturday, August 8th. Finally, Zacks Research raised shares of Krispy Kreme from a "strong sell" rating to a "hold" rating in a report on Tuesday, October 27th. One investment analyst has rated the stock with a Buy rating, one has issued a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat, the stock presently has an average rating of "Reduce" and an average price target of $4.33.

Krispy Kreme Price Performance

The company has a current ratio of 0.36, a quick ratio of 0.29 and a debt-to-equity ratio of 1.28. The stock has a market capitalization of $724.94 million, a PE ratio of -7.54 and a beta of 1.29. The firm has a 50 day moving average price of $3.13 and a 200 day moving average price of $3.34.

Krispy Kreme (NASDAQ:DNUT - Get Free Report) last announced its earnings results on Thursday, November 5th. The company reported $0.06 EPS for the quarter, topping analysts' consensus estimates of $0.01 by $0.05. Krispy Kreme had a negative return on equity of 1.17% and a negative net margin of 6.16%. The company had revenue of $328.76 million for the quarter, compared to analysts' expectations of $311.41 million. During the same period last year, the firm earned $0.01 EPS. Krispy Kreme's revenue for the quarter was down 12.4% compared to the same quarter last year. Research analysts anticipate that Krispy Kreme, Inc. will post -0.06 earnings per share for the current year.

Institutional Inflows and Outflows

Institutional investors have recently made changes to their positions in the stock. Carlyle Group Inc. bought a new position in shares of Krispy Kreme in the second quarter worth approximately $1,203,000. AlpInvest Partners B.V. purchased a new stake in shares of Krispy Kreme in the second quarter worth $2,231,000. BlackRock Inc. bought a new stake in shares of Krispy Kreme during the 2nd quarter valued at $23,353,000. Lazard Asset Management LLC bought a new stake in shares of Krispy Kreme during the 1st quarter valued at $1,883,000. Finally, Hsbc Holdings PLC bought a new stake in shares of Krispy Kreme during the 2nd quarter valued at $24,992,000. Institutional investors own 81.72% of the company's stock.

About Krispy Kreme

Krispy Kreme, Inc is a global doughnut and coffee company best known for its Original Glazed doughnuts. The company sells doughnuts, packaged sweets, coffee and other beverages through Krispy Kreme shops, in-store retail displays and digital ordering channels.

Krispy Kreme operates a hub-and-spoke distribution model that combines doughnut-making hubs and shops with delivery to grocery stores, convenience stores and other retail locations. Its products are also distributed through partnerships and branded locations, allowing the company to expand its reach beyond traditional Krispy Kreme shops.

Founded in 1937 in Winston-Salem, North Carolina, by Vernon Rudolph, Krispy Kreme has grown into an international brand serving customers in the United States and various markets across North America, Europe, Asia and Oceania.

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