Wall Street Zen Downgrades Krispy Kreme (NASDAQ:DNUT) to Sell

Key Points

• Wall Street Zen downgraded Krispy Kreme to “sell” from “hold,” while the broader analyst consensus is “Reduce,” with a consensus price target of $4.33.
• Krispy Kreme shares opened at $3.34, with the stock near its 52-week low and showing weak liquidity metrics, including a 0.42 current ratio and 1.31 debt-to-equity ratio.
• The company matched quarterly loss expectations at $0.03 per share but reported revenue of $331 million, above estimates; however, revenue declined 12.8% year over year and analysts expect a full-year loss of $0.07 per share.

Krispy Kreme (NASDAQ:DNUT - Get Free Report) was downgraded by analysts at Wall Street Zen from a "hold" rating to a "sell" rating in a research report issued on Saturday.

A number of other equities research analysts have also weighed in on the company. Zacks Research lowered Krispy Kreme from a "strong-buy" rating to a "hold" rating in a research note on Friday, May 15th. Weiss Ratings restated a "sell (d)" rating on shares of Krispy Kreme in a research report on Wednesday, June 24th. Finally, Evercore set a $4.00 price target on Krispy Kreme in a research report on Friday. Two analysts have rated the stock with a Buy rating, one has given a Hold rating and three have given a Sell rating to the company's stock. According to MarketBeat.com, the stock has a consensus rating of "Reduce" and a consensus target price of $4.33.

Krispy Kreme Price Performance

Shares of NASDAQ:DNUT opened at $3.34 on Friday. The stock has a market cap of $575.82 million, a PE ratio of -5.96 and a beta of 1.27. The company's fifty day moving average is $3.46 and its 200 day moving average is $3.41. Krispy Kreme has a 52 week low of $2.88 and a 52 week high of $5.11. The company has a quick ratio of 0.36, a current ratio of 0.42 and a debt-to-equity ratio of 1.31.

Krispy Kreme (NASDAQ:DNUT - Get Free Report) last posted its quarterly earnings results on Thursday, August 6th. The company reported ($0.03) earnings per share for the quarter, hitting the consensus estimate of ($0.03). Krispy Kreme had a negative net margin of 6.16% and a negative return on equity of 1.15%. The business had revenue of $331.00 million during the quarter, compared to the consensus estimate of $303.35 million. During the same period in the previous year, the firm posted ($0.15) earnings per share. The firm's revenue for the quarter was down 12.8% on a year-over-year basis. Research analysts anticipate that Krispy Kreme will post -0.07 earnings per share for the current year.

Insiders Place Their Bets

In other news, Director Bernardo Hees purchased 25,002 shares of the business's stock in a transaction on Friday, June 5th. The shares were acquired at an average price of $3.49 per share, with a total value of $87,256.98. Following the acquisition, the director directly owned 1,574,635 shares in the company, valued at approximately $5,495,476.15. The trade was a 1.61% increase in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at the SEC website. Over the last three months, insiders have acquired 880,190 shares of company stock worth $2,973,833. Corporate insiders own 1.60% of the company's stock.

Institutional Trading of Krispy Kreme

Institutional investors have recently modified their holdings of the company. Prudential Financial Inc. bought a new stake in shares of Krispy Kreme in the second quarter worth about $32,000. Russell Investments Group Ltd. raised its position in Krispy Kreme by 1,229.5% during the 3rd quarter. Russell Investments Group Ltd. now owns 8,469 shares of the company's stock valued at $33,000 after purchasing an additional 7,832 shares during the last quarter. Captrust Financial Advisors purchased a new stake in Krispy Kreme in the 2nd quarter worth approximately $34,000. Apollon Wealth Management LLC purchased a new stake in Krispy Kreme in the 1st quarter worth approximately $35,000. Finally, Raymond James Financial Inc. bought a new stake in shares of Krispy Kreme in the 2nd quarter worth approximately $37,000. 81.72% of the stock is currently owned by hedge funds and other institutional investors.

About Krispy Kreme

Krispy Kreme Doughnuts, Inc NASDAQ: DNUT is a global retailer and wholesaler renowned for its signature Original Glazed doughnut and a variety of other sweet treats. The company operates through a combination of company-owned stores, franchise outlets and strategic partnerships with supermarkets, convenience stores and other foodservice channels. In addition to its doughnut portfolio, Krispy Kreme offers freshly brewed coffee, assorted beverages and proprietary seasonal items designed to drive traffic and foster brand loyalty.

Founded in 1937 in Winston-Salem, North Carolina, by Vernon Rudolph, Krispy Kreme has grown from a single local shop to a multinational brand.

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