Truist says McDonald’s termination already priced into Krispy Kreme

Truist analyst Bill Chappell reiterates a Hold rating on Krispy Kreme (DNUT) after the company and McDonalds (MCD) announced the termination of their multiyear partnership. With Krispy Kreme shares down 73% year-to-date, this news is largely reflected in the current price, the analyst tells investors in a research note. “While disappointing, this news was largely expected after a pause to the partnership was announced in April,” contends Truist. Going forward, the firm believes Krispy Kreme can still leverage the capex spent on the partnership, but adds its margins will likely go lower before they return to 2024 levels. Despite the pullback in the shares, Truist advises investors “to remain on the sidelines until the dust settles.” The stock in afternoon trading is down 3c to $2.59.