Krispy Kreme, Inc. демонстрирует сложную финансовую картину с высокими мультипликаторами, такими как P/E на уровне 71.41, что указывает на потенциальную переоцененность по сравнению с отраслевыми стандартами. Долговая нагрузка, измеряемая через debt-equity ratio, превышает медианный уровень, что создает дополнительные риски для инвесторов. Несмотря на это, компания показывает сильные результаты по выручке, которая на 136% выше медианы отрасли. Однако, низкие показатели рентабельности, такие как ROE и ROA, которые значительно ниже медианных значений, вызывают обеспокоенность касательно эффективности управления. Дивидендная доходность на уровне 0.78% может показаться привлекательной, но недостаточная доля прибыли и негативные прогнозы EPS указывают на возможные проблемы в будущем. Общий уровень ликвидности, особенно current ratio и quick ratio, также указывает на потенциальные трудности с краткосрочными обязательствами. Эти факторы в совокупности приводят к необходимости пересмотра целевой цены вниз, чтобы учесть риски, связанные с высокой оценкой и слабой рентабельностью.

Krispy Kreme, Inc.

Kimberly-Clark Corporation KMB is advancing a significant organizational overhaul alongside its planned acquisition of Kenvue Inc. KVUE, aiming to create a more agile, market-focused global health and wellness entity.
The redesigned structure centers on a lean, matrix-based operating model, where regional business units hold full ownership of performance, while centralized functions support execution with specialized capabilities. This shift emphasizes faster decision-making and sharper accountability, enabling local teams to respond to consumer demand while benefiting from global scale.
Post-acquisition, Kimberly-Clark will operate across four key geographic segments: North America, Asia Pacific Focus Markets, Europe, the Middle East and Africa (EMEA), and Enterprise Markets. North America is expected to remain the largest contributor, generating roughly $18 billion in annual sales, while other regions collectively provide exposure to high-growth international markets. This segmentation reflects a deliberate effort to balance scale with regional responsiveness.
The structure also introduces streamlined leadership layers, with regional presidents driving market execution and a centralized team overseeing strategy, operations, supply chain and innovation. The model is designed to reduce duplication and improve coordination, a critical element as the company integrates Kenvue’s operations.
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KMB Targets Scale Gains From Integration
From a financial standpoint, the deal is expected to generate substantial synergies of approximately $2.1 billion, largely driven by cost optimization, procurement efficiencies and the elimination of overlapping corporate functions. The combined entity is projected to deliver more than $32 billion in revenues and around $7 billion in EBITDA before synergies, reinforcing its scale in the consumer health and personal care space.
The transaction values KVUE at approximately $48.7 billion, with shareholders receiving a mix of cash and stock. Upon completion, Kimberly-Clark shareholders are expected to own about 54% of the combined company, while Kenvue shareholders will hold the remaining stake. The deal is targeted to close in the second half of 2026.
While KMB shares have slipped 2.5% over the past three months, the decline is narrower than the industry’s 2.9% drop, suggesting that investors have remained relatively resilient on the Zacks Rank #3 (Hold) stock amid broader industry weakness and ongoing focus on the pending deal.
Overall, the new organizational framework underscores Kimberly-Clark’s focus on efficiency, scalability and market-driven growth, positioning the combined company to better capture opportunities across both developed and emerging markets.
Stocks to Consider
Krispy Creme, Inc. DNUT, which produces doughnuts, currently sports a Zacks Rank #1 (Strong Buy). DNUT delivered a trailing four-quarter earnings surprise of 14.6%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Krispy Creme’s current fiscal-year earnings suggests growth of 50% from the year-ago figure.
Purple Innovation, Inc. PRPL, which designs, manufactures, and sells sleep and other products, currently carries a Zacks Rank #2 (Buy) at present. PRPL delivered a trailing four-quarter earnings surprise of 22.7%, on average.
The Zacks Consensus Estimate for Purple Innovation’s current fiscal-year sales calls for growth of 6.6%, and estimates for earnings suggest a 25% increase from the year-ago figure.
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Kimberly-Clark's New Structure Sets Stage for Kenvue Integration

Newell Brands, Inc. NWL highlighted that 2025 proved more challenging than anticipated. The company expected a positive inflection in the core sales in the back half of 2025. However, tariffs disrupted this outlook, forcing multiple pricing actions that significantly impacted consumer behavior and retail dynamics. Categories initially projected to remain flat instead fell by 2–3 points, while some major retailers shifted from direct imports to domestic fulfillment. Competitive pricing responses were delayed, and certain international markets faced secondary tariff effects.
Newell remains cautious, as the company expects core sales to be in the range of down 2% to flat for 2026. The company expects a weak first quarter, projecting core sales to decline 7% to 5%. However, performance is expected to improve from the second quarter of 2026 as innovation and distribution gains begin to take effect.
The company began its turnaround strategy in the summer of 2023, which includes hiring brand management teams and overhauling its innovation pipeline. These efforts are now culminating in a comprehensive wave of innovation launching across all business units this year. Notably, 25 Tier 1 and Tier 2 innovations are set to launch the highest number recorded. Every business unit is contributing to this rollout, marking a significant milestone in the company’s innovation strategy.
Specific brands are already gaining momentum, with Graco becoming the #1 selling baby item in the United States, driving a 350 basis point market share gain for the Baby business. Yankee Candle’s relaunch also delivered 6% U.S. core sales growth in the fourth quarter, highlighting the impact of strong innovation and marketing.
While the significant headwinds persist, including a $150 million total gross P&L impact from tariffs, the company announced a global productivity plan expected to generate about $75 million of year-over-year savings. Given weak near-term core sales guidance and tariff pressures, caution remains warranted, though innovation momentum and productivity savings could support a gradual recovery.
The Zacks Rundown for NWL
Shares of this Zacks Rank #3 (Hold) company have lost 4.6% in the past three months compared with the industry’s decline of 0.5%.
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From a valuation standpoint, NWL trades at a forward price-to-earnings ratio of 6.59X, lower than the industry’s average of 17.62X.
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The Zacks Consensus Estimate for NWL’s current fiscal year earnings implies a year-over-year decline of 1.8%, and the same for next fiscal year earnings estimate implies year-over-year growth of 11.1%.
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Stocks to Consider
Some better-ranked stocks have been discussed below:
Krispy Kreme, Inc. DNUT produces doughnuts in the United States, the United Kingdom, Ireland, Australia, New Zealand, Mexico, Canada, Japan, and internationally. At present, DNUT sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for DNUT’s current fiscal-year sales implies a decline of 6.8%, and the same for earnings implies growth of 50% from the year-ago reported figures. DNUT delivered a trailing four-quarter earnings surprise of 14.6%, on average.
ARKO Corp. ARKO operates a chain of convenience stores in the United States. ARKO currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for ARKO's current fiscal-year sales implies a decline of 4.9%, while the same for current fiscal-year earnings implies growth of 73.3% from the year-ago reported figures. ARKO delivered a trailing four-quarter earnings surprise of 36.5%, on average.
Kenvue Inc. KVUE operates as a consumer health company in the United States, the rest of North America, Europe, the Middle East, Africa, the Asia-Pacific and Latin America. KVUE currently carries a Zacks Rank #2.
The Zacks Consensus Estimate for KVUE's current fiscal-year sales and earnings implies growth of 2.9% and 1.9%, respectively, from the year-ago actuals. KVUE delivered a trailing four-quarter negative earnings surprise of 9.8%, on average.
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Newell Brands Faces Soft Core Sales: Time to Stay Cautious?

Colgate-Palmolive Company’s CL Hill’s Pet Nutrition delivered strong fourth-quarter 2025 results despite a soft category, with dog segment weakness offset by continued growth in the cat business. The U.S. showed a solid rebound, supported by more than 5% growth excluding private label and positive volume performance. While external challenges, such as “Buy Canadian” trends, impacted Canada, overall momentum remains encouraging. A primary driver of growth was the prescription diet segment; growth is particularly strong, driving share gains and reinforcing confidence in Hill’s sustained progress despite sluggish market conditions.
Despite a challenging category, private label reduced volume by 360 basis points, Hill’s delivered underlying volume growth of 2%, with broad-based gains across core segments, though dry remained soft. Therapeutic products remain a key growth driver, with Prescription Diet delivering strong growth and market share gains, supporting margins and profitability. Science-based innovation continues to drive gains across channels and create value for retailers. While softer pet adoptions are weighing on category growth, ongoing premiumization and innovation present clear opportunities.
Strategic acquisitions like Prime100 continued to outperform expectations, driven by strong execution and its science-based, vet-endorsed positioning. The brand’s focus on dermatology and innovation in fresh nutrition aligns well with its long-term growth strategy. It is already profitable, with ongoing efforts to enhance efficiency, formulations and supply-chain performance.
The company exited 2025 with increased shelf share, strengthening its position heading into a more challenging 2026. Supply-chain improvements are supporting higher innovation output, with the Tonganoxie plant adding flexibility to expand global wet product distribution. The brand continues to grow across key retail environments despite heightened competition in the second half of the year. Overall, science-led strategy continues to outperform, and ongoing investment in brand advertising is helping sustain momentum.
Zacks Rundown for CL
Colgate’s shares have gained 9.5% in the past six months against the industry’s decline of 6.5%. CL currently carries a Zacks Rank #3 (Hold).
Image Source: Zacks Investment Research
From a valuation standpoint, CL trades at a forward price-to-earnings ratio of 21.57, higher than the industry’s average of 17.43X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CL’s current and next fiscal-year earnings implies year-over-year growth of 5.4% and 6.7%, respectively.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
Smithfield Foods, Inc. SFD produces various packaged meats and fresh pork products in the United States and internationally. SFD currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for SFD's current fiscal-year sales and earnings implies growth of 1.1% and 7.5%, respectively, from the year-ago reported figures. SFD delivered a trailing four-quarter earnings surprise of 15.3%, on average.
Krispy Kreme, Inc. DNUT produces doughnuts in the United States, the United Kingdom, Ireland, Australia, New Zealand, Mexico, Canada, Japan, and internationally. At present, DNUT sports a Zacks Rank of 1.
The Zacks Consensus Estimate for DNUT’s current fiscal-year sales implies a decline of 6.8%, and the same for earnings implies growth of 50% from the year-ago reported figures. DNUT delivered a trailing four-quarter earnings surprise of 14.6%, on average.
Kenvue Inc. KVUE operates as a consumer health company in the United States, the rest of North America, Europe, the Middle East, Africa, the Asia-Pacific and Latin America. KVUE currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for KVUE's current fiscal-year sales and earnings implies growth of 2.9% and 1.9%, respectively, from the year-ago actuals. KVUE delivered a trailing four-quarter negative earnings surprise of 9.8%, on average.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Colgate's Pet Nutrition Strength: Can Hill's Sustain Momentum?

(RTTNews) - Krispy Kreme Inc. (DNUT) on Wednesday announced a one-day promotional offer allowing customers to purchase an Original Glazed dozen for 13 cents with the purchase of any dozen at regular price on Friday, March 13.
The offer will be available at participating stores across the U.S. for in-shop purchases as well as pickup or delivery through the company's mobile app and website using promo code "13." The promotion is limited to one discounted dozen per guest.
The company also said customers can purchase its St. Patrick's Day doughnut collection through March 17.
The seasonal lineup includes the Shooting Shamrock, Over the Rainbow, Plaid Party, and Chocolate Iced with St. Patrick's Sprinkles doughnuts.
Krispy Kreme is 1.17% higher at $3.4600 on the Nasdaq.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Krispy Kreme Offers Original Glazed Dozen For 13 Cents With Purchase Of Any Dozen

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Krispy Kreme Inc (Symbol: DNUT), where a total volume of 13,349 contracts has been traded thus far today, a contract volume which is representative of approximately 1.3 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 73.1% of DNUT's average daily trading volume over the past month, of 1.8 million shares. Particularly high volume was seen for the $4 strike call option expiring February 27, 2026, with 1,772 contracts trading so far today, representing approximately 177,200 underlying shares of DNUT. Below is a chart showing DNUT's trailing twelve month trading history, with the $4 strike highlighted in orange:
PACS Group Inc (Symbol: PACS) options are showing a volume of 6,943 contracts thus far today. That number of contracts represents approximately 694,300 underlying shares, working out to a sizeable 72.9% of PACS's average daily trading volume over the past month, of 952,285 shares. Especially high volume was seen for the $60 strike call option expiring April 17, 2026, with 1,888 contracts trading so far today, representing approximately 188,800 underlying shares of PACS. Below is a chart showing PACS's trailing twelve month trading history, with the $60 strike highlighted in orange:
And Hewlett Packard Enterprise Co (Symbol: HPE) saw options trading volume of 119,327 contracts, representing approximately 11.9 million underlying shares or approximately 69.8% of HPE's average daily trading volume over the past month, of 17.1 million shares. Especially high volume was seen for the $22 strike call option expiring March 20, 2026, with 36,753 contracts trading so far today, representing approximately 3.7 million underlying shares of HPE. Below is a chart showing HPE's trailing twelve month trading history, with the $22 strike highlighted in orange:
For the various different available expirations for DNUT options, PACS options, or HPE options, visit StockOptionsChannel.com.
Also see:
Funds Holding MRAC
Institutional Holders of SNAL
Institutional Holders of MXA
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Notable Thursday Option Activity: DNUT, PACS, HPE

In trading on Thursday, specialty retail shares were relative leaders, up on the day by about 3.1%. Leading the group were shares of Warby Parker, up about 24.7% and shares of The Honest Company up about 19.1% on the day.
Also showing relative strength are grocery & drug stores shares, up on the day by about 2.9% as a group, led by Krispy Kreme, trading up by about 33.1% and Primo Brands Corporation, trading up by about 12.8% on Thursday.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Thursday Sector Leaders: Specialty Retail, Grocery & Drug Stores

Key Points
Krispy Kreme's U.S. fresh delivery model is profitable and expanding, but the company is still losing money.
The company's interest expenses and 0.36 current ratio make its current business model unsustainable, which is why it's aggressively deleveraging.
While a deleveraged balance sheet could eventually allow it to regain profitability, it could take years of falling revenues before it can achieve that goal.
Krispy Kreme (NASDAQ: DNUT) has firmly established itself as a meme stock. It's down by 54% this year, but has also surged by almost 70% from the bottom of the trough it sank into this summer. In its Q3 earnings press release, CEO Josh Charlesworth highlighted two initiatives that could help the company return to profitability and revenue growth after skidding in recent years.
Net income has been negative for a while, and in the few quarters Krispy Kreme has been profitable over the past five years, its margins have been razor-thin.
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Two big opportunities
Charlesworth said that profitable U.S. expansion and capital-light international franchise growth are the two levers that will bring the company back to profitability. However, it still looks like it faces an uphill battle. Revenue dropped by 1.2% year over year in Q3. But its $7.2 million operating loss was narrower than its $16 million operating loss in the prior-year period.
Krispy Kreme is still shrinking, based on its 6.1% year-over-year decline in global points of access. It also ended its unprofitable partnership with McDonald's. These are smart moves to deleverage the balance sheet, but it's hard to grow sales while removing locations.
Krispy Kreme is focusing on profitable growth, so if its revenue dropped considerably, but its net margins turned positive again, that would be a big win, and a base the company could build on. It has lightly tapped into international markets and is working with local franchisee operators to scale up in a capital-light way.
Charlesworth also said that Krispy Kreme's U.S. fresh delivery model is profitable and expanding, but the company didn't provide specific numbers for that segment. The food delivery space has been hot. If Krispy Kreme can continue to capitalize on it, its margins may flip to positive.
The balance sheet must be deleveraged
Krispy Kreme's balance sheet is a disaster that can't be sustained. That's why closing many locations is necessary, though it will come at the cost of revenue growth. The doughnut maker must shrink before it can grow again, and that transition may take multiple years to complete.
Interest expenses are another issue for the company. Its Q3 operating loss of $7.2 million was bad enough, but that doesn't include the $16.4 million it spent on interest. That was nearly identical to the amount of interest it paid in Q3 2024.
It also has $161.8 million in total current assets against $448.9 million in total current liabilities, resulting in a low 0.36 current ratio. The median current ratio for the retail industry is 1.3. Krispy Kreme's low ratio shows that it won't be able to keep up with current obligations unless it continues to deleverage its balance sheet.
It has a 0.5 price-to-sales ratio, and a P/S ratio in the 1 to 2 range is generally viewed as fairly valued. A lower ratio implies a better value, but investors shouldn't expect Krispy Kreme's ratio to rise to 1 anytime soon. The only path to solving its profitability issues involves a prolonged period of revenue declines and deleveraging. Once profitability is achieved and the business rebounds, the stock could potentially warrant a multiple expansion. But the second-half rally in Krispy Kreme stock has been more driven by meme trading and momentum than fundamentals.
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Marc Guberti has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Can Krispy Kreme Preserve Its Meme-Stock Rally in 2026?

Key Points
Kohl's has outperformed the S&P 500 this year, but is still woefully behind over the past five years.
A low quick ratio puts a lot of pressure on declining inventory sales to cover current liabilities.
Interest eats up all of Kohl's operating income, so it's no surprise the retailer had to significantly cut its dividend.
Kohl's (NYSE: KSS) stock surprised the naysayers with a 64% surge this year, but its five-year chart shows what more people would expect from a declining clothing retail stock. Its 42% drop during that time doesn't come close to the S&P 500's (SNPINDEX: ^GSPC) 83% gain over the same time frame, but the index is only up by 16% this year.
The company offers a 2.18% yield at current levels, but narrow profit margins limit future dividend growth. It's also not a good sign that Kohl's cut its dividend by 75% earlier this year.
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The stock has shown signs of life this year, largely due to its status as a meme stock. It joins Krispy Kreme, Opendoor Technologies, and Rocket Companies as the DORK stocks, an acronym that refers to the four hottest meme stocks in 2025.
Is Kohl's nothing more than a meme play, or is there some value behind the name? Here's what investors should know.
It's hard to compete against the retail giants
Walmart, Costco, and Target are the three retail giants, and the former two have been pulling away from the latter. This context is important for Kohl's stock, since those three retailers offer almost every possible item, including clothing. Why shop at Kohl's when you can buy affordable clothing and groceries at one of the retail giants?
These retail giants let you get everything done in one trip, and Kohl's doesn't give people that luxury. That may be part of the reason Kohl's had yet another quarter that featured year-over-year decreases in net sales and comparable sales. Fewer people are buying from Kohl's locations, and when they show up, they are spending less than they did one year ago. Walmart and Costco don't have that problem and continue to gain market share.
Not only is competition intense, but Kohl's also has low profit margins, which normally hover below 1%. That doesn't give Kohl's any leeway if costs go up or additional tariffs are enforced. It won't even get better for the rest of the year, with Kohl's anticipating net sales dropping by 3.5% to 4% for the full year. Analysts expect full-year comparable sales to drop by 2.5% to 3% year over year.
The balance sheet is a disaster
The balance sheet is a key culprit to Kohl's 42% decline over the past five years, and that drop includes the 2025 meme rally. Kohl's financial situation doesn't give the retailer much flexibility to invest in growth initiatives, and even making a profit is difficult.
Kohl's has $4.3 billion in current assets and $3.3 billion in current liabilities, which comes to a 1.30 current ratio, which sounds good. However, Kohl's has $3.9 billion in merchandise inventories that make up the $4.3 billion. Excluding its inventory, Kohl's only has $400 million in current assets and $3.3 billion in current liabilities, resulting in a 0.12 quick ratio. In short, this low quick ratio suggests minimal cash reserves and burdensome liabilities with upcoming due dates.
That means Kohl's doesn't have a good way to keep up with its financial obligations if inventory sales slow. It's not much of a problem if Kohl's manages to sell all of its inventory, but declining revenue and comparable sales make that scenario more difficult to achieve each year. Furthermore, Kohl's total assets dropped by 6% year over year.
Kohl's also gets its margins squeezed by interest, which won't go away anytime soon. The retailer had $73 million in Q3 operating income, but it spent $75 million on interest. Kohl's reported a positive net income only because of a one-time tax provision of $10 million. Kohl's ended up owing less in taxes than expected and could tap into some of its tax reserves as a result. It's not a winning formula for the long run.
Investors benefit from holding successful growth stocks long-term. However, the fundamentals make Kohl's stock look like a sinking ship struggling to stay afloat. Fundamentals matter more than stock price movements.
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Marc Guberti has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale, Rocket Companies, Target, and Walmart. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Has Kohl's (KSS) Stock Been Good for Investors?

Key Points
Krispy Kreme is time honored for its doughnuts, but there are still problems with the business.
From a stock perspective, Krispy Kreme is underperforming the market, and struggling with consistent profitability.
The company has put together some turnaround ideas that need a little bit of substance to take seriously.
Doughnuts. We all love them. Despite this, they're not always the dream investment. Some operations do well, while others are struggling right now. Krispy Kreme (NASDAQ: DNUT) makes its money from the sale of its famous doughnuts, as well as coffee and other drinks. The chain has been around for a long time, but has struggled somewhat to find its footing in recent years in terms of profitability.
This is not a stock that has been outperforming. The shares are down more than 77% over the last five years, versus an S&P 500 return of over 85% in gains. Things have been a bit different over the last six months, as the big pullbacks in Krispy Kreme's stock have seemingly led to investors getting reinvigorated in owning shares, despite the fact that the company has some weakening financials. In all, shares are up 46.8% over the last six months.
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Through the last five years, the company has been largely unprofitable. The doughnut/coffee chain had losses in 2020, 2021, 2022, and 2023. Things changed in 2024, but it was a small $3.1 million in net income, off of $1.67 billion in net revenue.
In 2025, the first three quarters have been a little rough. Net revenues declined by 10.39% through the first three quarters of the year to $1.13 billion. Income took a major hit and fell to a net loss attributable to Krispy Kreme of roughly $488 million, versus a profit of $25.5 million in the first nine months of fiscal 2024. In all, Krispy Kreme had losses of $2.86 per diluted share through the first nine months of 2025.
Because of these shifts, the balance sheet is taking some tough hits. While total cash increased slightly year over year in the third quarter to $30.7 million, total equity took a big hit. Shareholders' equity declined 41% year over year to $693.8 million.
The company is undertaking a number of initiatives to attempt to make a turnaround in the business. These include refranchising, which the company claims will improve financial flexibility. A part of this plan is to improve Krispy Kreme's return on invested capital through the aforementioned refranchising and taking advantage of existing assets. The company also says it wants to expand margins through moves such as outsourcing U.S. logistics.
The fourth and final piece of the listed turnaround plan was to "drive sustainable, profitable growth." This one seemed a bit generic, as every company is meant to drive sustainable and profitable growth.
Before buying Krispy Kreme, you need to decide if you're willing to trust that these turnaround measures will have the desired effect. They seem a little vague as to the actual implementation.
Should you invest $1,000 in Krispy Kreme right now?
Before you buy stock in Krispy Kreme, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Krispy Kreme wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $513,353!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,072,908!*
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David Butler has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Read This Before Buying Krispy Kreme Stock

Key Points
Krispy Kreme looks cheap for good reasons -- but that could change.
Margins are rising, and refranchising is underway, but profitability remains elusive.
Krispy Kreme's global brand provides a cushion, but execution will ultimately determine whether it becomes a long-term success.
Krispy Kreme (NASDAQ: DNUT) has long been one of America's most recognizable consumer brands. But for investors, it is also a reminder that not every beloved brand translates into a winning stock.
After its 2021 initial public offering (IPO), Krispy Kreme's shares have lost more than half their value, recently falling to $4.40 per share (as of writing), near an all-time low. At first glance, that makes the stock look irresistibly cheap. The company trades at roughly 0.5 times sales, a fraction of what most consumer brands command. But as any seasoned investor knows, a low valuation doesn't always mean a bargain.
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The question is simple: Is Krispy Kreme undervalued, or is it cheap for a reason?
A brand with reach, and a reputation to match
There's no denying the global power of Krispy Kreme's brand. Founded in 1937, the company operates in over 40 countries and sells millions of doughnuts daily. Its nostalgic appeal and emotional connection with customers remain strong, even after decades of ownership changes and financial resets.
For a company with such visibility, its market capitalization of under $800 million seems small. That's less than the valuation of many regional coffee chains, let alone global food-service peers. On the surface, it appears to be a classic small-cap opportunity -- a well-known brand that the market has temporarily overlooked.
But dig deeper, and the valuation reflects something more fundamental: a business model still searching for consistency.
An overview of the key financials
Krispy Kreme generated about $1.6 billion in annual revenue, yet continues to post operating losses. In 2024, the company swung from an operating profit of $13 million to a loss of $9 million. Even in the most recent quarter, ending September 2025, the company remained unprofitable, despite a modest improvement in adjusted EBITDA margin to 10.8%, up from 9.1% in the same quarter a year earlier.
That progress is encouraging, but it also highlights the problem. For a company with global scale, a 10% EBITDA margin is modest at best. Competitors like Starbucks operate at an EBITDA margin above 15%, even as the latter undergoes its own turnaround efforts. In short, Krispy Kreme doesn't yet earn enough on its capital to justify a higher valuation.
This inferior margin explains why the market is skeptical. A price-to-sales ratio of 0.5 looks appealing, but when profits are elusive and returns on invested capital are near zero, even a low multiple can still be expensive.
What are the bulls betting on?
Optimists point to early signs of a real turnaround. Management has been refranchising operations, closing unprofitable outlets, and shifting toward a more capital-light model. The strategy mirrors what other food-service success stories achieved in their transformation phases -- trading ownership for scalability and focusing on high-volume, high-margin distribution points.
There's also the potential for international growth. Krispy Kreme's brand is still underpenetrated in markets like Asia and Latin America, where premium Western dessert brands remain in high demand. If the company can replicate its U.S. awareness abroad, it could achieve steady mid-single-digit revenue growth, accompanied by rising margins over time.
For the bulls, Krispy Kreme appears to be a low-expectations turnaround story with significant upside if execution continues to improve.
Why aren't the bears convinced?
Skeptics counter that Krispy Kreme has been here before. The company has attempted multiple restructurings over the past two decades, each promising efficiency, growth, and margin expansion; yet none have delivered sustainable profitability.
Its "hub-and-spoke" distribution model, while innovative, remains capital-heavy and operationally complex. Each regional hub must maintain enough volume to justify its costs. On the one hand, the food company is closing down unprofitable stores, yet at the same time, it's losing operating leverage. Striking a balance here is a challenging task.
There's also the issue of execution risk. The company's partnership with McDonald's USA, once touted as a national growth engine, was terminated in 2025 after only a few months due to unprofitable unit economics. For bears, that episode encapsulates Krispy Kreme's challenge: scale is easy; profitable scale is not.
What does it mean for investors?
So, does Krispy Kreme stock look cheap? Yes, but only if the turnaround succeeds.
At current prices, the market is clearly pricing in pessimism. If margins climb meaningfully and international growth accelerates, the stock could offer multibagger potential from a small base. But if profits remain inconsistent or the business model fails to scale, "cheap" could quickly become "cheap for a reason."
For investors, the trade-off is simple: Krispy Kreme offers brand-driven upside and execution-driven risk.
It's potentially a high-return stock, but that too comes with a commensurate risk profile.
Should you invest $1,000 in Krispy Kreme right now?
Before you buy stock in Krispy Kreme, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Krispy Kreme wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $572,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,104,969!*
Now, it’s worth noting Stock Advisor’s total average return is 1,002% — a market-crushing outperformance compared to 193% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of November 24, 2025
Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Starbucks. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.