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1. Company Snapshot

1.a. Company Description

Krispy Kreme, Inc., together with its subsidiaries, operates through an omni-channel business model to provide doughnut experiences and produce doughnuts.The company operates through three segments: U.S. and Canada, International, and Market Development.It also produces cookies, brownies, cookie cakes, ice cream, cookie-wiches, and cold milk, as well as doughnut mixes, other ingredients, and doughnut-making equipment.


As of January 2, 2022, the company had 1,810 Krispy Kreme and Insomnia Cookies-branded shops in approximately 30 countries worldwide, which include 971 company owned and 839 franchised.It serves through doughnut shops, delivered fresh daily outlets, ecommerce, and delivery business.The company was formerly known as Krispy Kreme Doughnuts, Inc.


and changed its name to Krispy Kreme, Inc.in May 2021.Krispy Kreme, Inc.


was founded in 1937 and is headquartered in Charlotte, North Carolina.

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1.b. Last Insights on DNUT

Krispy Kreme's recent performance was negatively driven by weaker-than-expected Q4 earnings and revenue, partly due to a 10% drop in revenue from last year. The company's international sales reliance, which impacted Wall Street's forecasts, added to the concerns. Additionally, Krispy Kreme's decision to issue weaker-than-expected guidance and ongoing restructuring efforts following a cyberattack, likely hurt investor confidence. The company's CEO discussed long-term growth, but the recent struggles and negative guidance overshadowed these plans.

1.c. Company Highlights

2. Krispy Kreme's Turnaround Plan Shows Progress

Krispy Kreme reported a slight revenue decline in Q3 2025, but a significant improvement in EBITDA and positive cash flow, driven by the intentional exit from underperforming doors, including McDonald's restaurants and 600 poor performing locations. The company's EPS came in at $0.01, beating estimates of -$0.06. The adjusted EBITDA improvement positively impacted the net leverage ratio, which decreased to 7.3x from 7.5x in the previous quarter. The company's efforts to refranchise and improve returns on capital are yielding results, with estimated $12 million to $15 million of annualized SG&A cost savings.

Publication Date: Nov -24

📋 Highlights
  • Deleveraging Progress: Net leverage ratio decreased to 7.3x from 7.5x, aided by EBITDA improvements and refranchising proceeds.
  • Refranchising Impact: Exit of 600 underperforming units caused revenue decline but boosted EBITDA and generated positive cash flow.
  • International Momentum: Growth in markets like Brazil and plans for new openings, contributing to year-over-year international sales gains.
  • Cost Savings: Estimated $12M–$15M annualized SG&A savings from logistics efficiencies and operational productivity improvements.
  • Q4 Outlook: Sequential EBITDA improvement and positive cash flow expected in Q4, with no guidance but optimism for continued turnaround progress.

Operational Improvements

The company is making progress in its turnaround plan, with a focus on refranchising, improving returns on capital, and expanding margins. The restructuring of the joint venture in the Western U.S. with the WKS Restaurant Group is expected to contribute to the reduction of net debt. Additionally, Krispy Kreme is improving its delivery timing and producing doughnuts in close proximity to customers, but only in locations with high traffic and in-store visibility, as stated by Joshua Charlesworth, "we are continuously improving delivery timing and producing doughnuts in close proximity to customers".

Valuation Metrics

Based on the current valuation metrics, Krispy Kreme's P/E Ratio is -1.25, P/B Ratio is 0.95, and EV/EBITDA is -3.33. The company's Net Debt / EBITDA ratio is -1.46, indicating a relatively healthy debt position. The Dividend Yield is 1.88%, providing some return to shareholders. However, the ROE and ROIC are negative, at -56.71% and -19.76% respectively, indicating that the company's profitability is still a concern.

Outlook

Raphael Duvivier stated that the company expects further improvement in adjusted EBITDA for the remainder of 2025 and Q4, as well as positive cash flow in Q4. The analysts estimate next year's revenue growth at -1.3%, indicating a continued challenging environment. However, Krispy Kreme's brand awareness and uniqueness in sharing occasions make it less susceptible to competition, according to Joshua Charlesworth.

New Menu Lineup

The company recently announced an expanded core menu lineup, which includes items like OREO Cookies with Kreme and New York Cheesecake, while maintaining a balance between variety and complexity. This move is expected to drive sales growth and improve customer engagement. The new menu lineup is a response to consumer demand and a need to refresh the assorted doughnut menu.

3. NewsRoom

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Krispy Kreme Stock Looks Cheap -- or Does It?

Nov -28

Source: fool.com

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How Has DNUT Stock Done for Investors?

Nov -27

Source: fool.com

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KRISPY KREME® x Peanuts Collection Is Filled With Holiday Cheer

Nov -24

Source: businesswire.com

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Don't Overlook Krispy Kreme (DNUT) International Revenue Trends While Assessing the Stock

Nov -17

Source: zacks.com

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Why Is Everyone Talking About Krispy Kreme Stock?

Nov -17

Source: fool.com

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3 Risks That Could Derail Krispy Kreme's Turnaround

Nov -16

Source: fool.com

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3 Reasons the Bulls Are Optimistic About Krispy Kreme Stock

Nov -16

Source: fool.com

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KRISPY KREME® Spreads Joy on World Kindness Day, Nov. 13

Nov -10

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.96%)

6. Segments

United States

Expected Growth: 7.5%

Krispy Kreme's 7.5% growth in the United States is driven by increasing demand for sweet treats, expansion of e-commerce and delivery channels, and strategic partnerships with coffee chains. Additionally, the brand's focus on innovation, such as introducing new flavors and limited-time offers, has contributed to its growth.

International

Expected Growth: 9.0%

Krispy Kreme's 9.0% international growth is driven by strategic market expansion, particularly in Asia and Latin America, where a growing middle class and increasing demand for sweet treats are fueling sales. Additionally, the company's focus on digital transformation, including mobile ordering and delivery, is enhancing customer convenience and driving sales.

Market Development

Expected Growth: 8.5%

Krispy Kreme's 8.5% market development growth is driven by strategic expansion into new markets, increased brand awareness through effective marketing campaigns, and a growing demand for premium coffee and sweet treats. Additionally, the company's focus on digital transformation, including mobile ordering and delivery, has enhanced customer convenience and experience, contributing to the impressive growth rate.

7. Detailed Products

Krispy Kreme Doughnuts

Freshly baked, handcrafted doughnuts made with a secret recipe, available in a variety of flavors and toppings

Coffee and Beverages

A selection of hot and iced coffee drinks, lattes, cappuccinos, and teas, made with 100% Arabica coffee beans

Krispy Kreme Rewards

A loyalty program that rewards customers with points for every purchase, redeemable for free doughnuts and drinks

Catering and Events

Customized doughnut and beverage packages for corporate events, weddings, and parties

Fundraising Programs

Partner with Krispy Kreme to raise funds for schools, charities, and non-profit organizations

Gift Cards

Digital or physical gift cards, redeemable at participating Krispy Kreme locations

8. Krispy Kreme, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Krispy Kreme's products are moderately substitutable with other baked goods and coffee. However, the company's unique recipe and brand loyalty reduce the threat of substitutes.

Bargaining Power Of Customers

Krispy Kreme's customers have limited bargaining power due to the company's strong brand and limited availability of substitutes.

Bargaining Power Of Suppliers

Krispy Kreme's suppliers have limited bargaining power due to the company's large scale of operations and ability to negotiate favorable prices.

Threat Of New Entrants

The threat of new entrants is high due to the relatively low barriers to entry in the baked goods and coffee industry. However, Krispy Kreme's strong brand and established distribution network provide a competitive advantage.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of established competitors such as Dunkin' Donuts and Starbucks. However, Krispy Kreme's unique products and brand loyalty help to differentiate the company.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.49%
Debt Cost 4.72%
Equity Weight 56.51%
Equity Cost 11.55%
WACC 8.58%
Leverage 76.96%

11. Quality Control: Krispy Kreme, Inc. passed 0 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Village Super Market

A-Score: 6.7/10

Value: 7.4

Growth: 4.9

Quality: 4.7

Yield: 7.0

Momentum: 8.5

Volatility: 7.7

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Weis Markets

A-Score: 6.2/10

Value: 7.6

Growth: 4.7

Quality: 5.1

Yield: 4.0

Momentum: 7.5

Volatility: 8.0

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Natural Grocers

A-Score: 5.7/10

Value: 4.8

Growth: 6.6

Quality: 4.7

Yield: 6.0

Momentum: 9.0

Volatility: 3.0

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Ingles Markets

A-Score: 5.4/10

Value: 5.7

Growth: 4.8

Quality: 4.2

Yield: 2.0

Momentum: 7.0

Volatility: 8.7

1-Year Total Return ->

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Krispy Kreme

A-Score: 4.2/10

Value: 9.4

Growth: 6.9

Quality: 4.2

Yield: 3.0

Momentum: 0.0

Volatility: 2.0

1-Year Total Return ->

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Duckhorn Portfolio

A-Score: 4.0/10

Value: 2.7

Growth: 4.1

Quality: 6.1

Yield: 0.0

Momentum: 7.0

Volatility: 4.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

4.27$

Current Price

4.27$

Potential

-0.00%

Expected Cash-Flows