Krispy Kreme (DNUT) AI Stock Analysis

• Market Cap: $539.60M
• Dividend Yield: 3.34%
• Average Volume (3M): 2.07M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.53
• Revenue Growth: -10.40%
• EPS Growth: -1904.10%
• Country: US
• Employees: 21,000
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Grocery Stores
• EPS (TTM): 0.01
• Shares Outstanding: 171,300,000
• 10 Day Avg. Volume: 1,947,686
• 30 Day Avg. Volume: 2,068,288
• PEG Ratio: -4.84
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 0.97
• P/FCF Ratio: -21.57
• Enterprise Value/Market Cap: 3.61
• Enterprise Value/Revenue: 1.27
• Enterprise Value/Gross Profit: 2.03
• Enterprise Value/Ebitda: -5.77
• 1Y Price Target: $3.67
• Price Target Upside: 16.51% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 46 Neutral
• Price Target: $3.00 ▼(-4.76% Downside)

The score is held down primarily by weak financial performance (sharp revenue decline, large losses, and weak cash generation) and bearish technical momentum (below major moving averages with negative MACD). Offsetting factors include a somewhat encouraging earnings-update trajectory (EBITDA improvement and a positive FCF quarter) and a high dividend yield, though the negative P/E reflects ongoing profitability risk.

Positive Factors

Adjusted EBITDA growth

A 17% YoY increase in adjusted EBITDA to $40.6M indicates operating leverage and margin recovery from turnaround actions. Sustained EBITDA growth improves internal cash generation, supports deleveraging and reinvestment, and strengthens long-term operational resilience.

Quarterly positive free cash flow

Generating positive free cash flow in the quarter demonstrates improving cash conversion from operations. If sustained, this durable cash generation helps fund debt reduction, reduce reliance on asset sales, and finance selective reinvestment without materially increasing leverage.

Refranchising and Japan sale strategic move

Refranchising Japan into a franchise model and unlocking ~$65M of proceeds is a structural shift that lowers capital intensity, improves returns on invested capital, and accelerates deleveraging. Franchise expansion reduces company-owned operational burden long-term.

Negative Factors

Declining revenue and deep losses

Substantial revenue declines and a deeply negative net margin reflect structural demand and profitability challenges. Persistent revenue contraction erodes scale benefits, undermines franchise economics, and limits the company's ability to sustainably generate returns for shareholders.

Weak trailing cash generation

A negative TTM free cash flow and a very low operating cash flow to net income ratio indicate difficulty converting earnings into cash. This structural cash conversion weakness constrains debt paydown, capex, and franchise support without recurring asset sales or external financing.

Elevated leverage despite improvement

While leverage has declined, a net leverage ratio around 7.3x remains high and limits strategic flexibility. Elevated leverage raises refinancing and interest-rate vulnerability, making the company more reliant on sustained operational improvement to avoid recurring liquidity or solvency pressures.

Krispy Kreme Business Overview & Revenue Model

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.

How the Company Makes Money

Krispy Kreme generates revenue primarily through the sale of its doughnuts and beverages at retail locations. Its revenue model includes direct sales from company-owned stores and franchise royalties from franchisee operations. Key revenue streams consist of in-store sales, wholesale distribution to grocery chains and convenience stores, and special event catering. The company also benefits from partnerships with various retailers and coffee distributors to expand its market reach and product availability. Additionally, Krispy Kreme engages in promotional collaborations and limited-time offers that drive traffic and customer engagement, contributing to its overall earnings.

Krispy Kreme Financial Statement Overview

Summary

Financial statements show material weakness: steep TTM revenue decline (-29.7%), deeply negative net margin (-33.27%), and negative EBIT/EBITDA margins. Leverage looks improved (debt-to-equity 0.79), but returns remain very poor (ROE -56.71%) and TTM free cash flow is negative with deteriorating FCF growth (-28%).

Income Statement

Krispy Kreme's income statement reveals significant challenges. The TTM data shows a negative revenue growth rate of -29.7%, indicating a substantial decline in sales. The gross profit margin remains relatively high at 75.36%, but the net profit margin is deeply negative at -33.27%, reflecting significant losses. Both EBIT and EBITDA margins are negative, highlighting operational inefficiencies. The company needs to address its declining revenues and improve profitability to enhance its financial health.

Balance Sheet

The balance sheet shows a mixed picture. The debt-to-equity ratio has improved to 0.79 in the TTM period, indicating better leverage management compared to previous years. However, the return on equity is negative at -56.71%, reflecting poor profitability relative to shareholder equity. The equity ratio stands at 25.82%, suggesting a moderate level of equity financing. Overall, while leverage has improved, profitability remains a concern.

Cash Flow

Cash flow analysis indicates significant challenges. The TTM free cash flow is negative, and the free cash flow growth rate is -28%, showing a deterioration in cash generation. The operating cash flow to net income ratio is low at 0.036, and the free cash flow to net income ratio is highly negative, indicating that the company is struggling to convert its earnings into cash. Improving cash flow generation is critical for financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.53B	1.67B	1.69B	1.53B	1.38B	1.12B
Gross Profit	960.28M	1.26B	1.24B	1.12B	1.03B	242.67M
EBITDA	-337.49M	213.43M	135.24M	136.20M	140.52M	85.78M
Net Income	-510.43M	3.10M	-37.92M	-15.62M	-24.51M	-64.78M
Balance Sheet
Total Assets	2.60B	3.07B	3.24B	3.15B	3.15B	3.06B
Cash, Cash Equivalents and Short-Term Investments	31.15M	28.96M	38.19M	35.37M	38.56M	38.51M
Total Debt	1.44B	1.35B	1.40B	1.24B	1.18B	1.59B
Total Liabilities	1.91B	1.91B	1.98B	1.85B	1.81B	2.21B
Stockholders Equity	672.05M	1.13B	1.17B	1.20B	1.23B	684.68M
Cash Flow
Free Cash Flow	-98.81M	-74.96M	-75.88M	28.10M	21.73M	-69.15M
Operating Cash Flow	15.95M	45.83M	45.54M	139.82M	141.22M	28.68M
Investing Cash Flow	-22.05M	19.28M	-112.59M	-120.88M	-153.41M	-168.13M
Financing Cash Flow	15.80M	-73.95M	71.86M	-17.43M	16.10M	139.44M

Krispy Kreme Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DNUT, the sentiment is Negative. The current price of 3.15 is below the 20-day moving average (MA) of 3.76, below the 50-day MA of 4.03, and below the 200-day MA of 3.61, indicating a bearish trend. The MACD of -0.28 indicates Positive momentum. The RSI at 27.08 is Positive, neither overbought nor oversold. The STOCH value of 7.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DNUT.

Krispy Kreme Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMKTA	72 Outperform	$1.39B	17.01	5.29%	0.93%	-5.42%	-20.80%
VLGEA	70 Outperform	$474.53M	9.30	11.22%	2.63%	3.88%	7.71%
NGVC	70 Neutral	$629.26M	13.68	24.02%	1.99%	7.19%	35.90%
DDL	67 Neutral	$620.58M	16.55	33.30%	―	8.34%	40.20%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
GO	52 Neutral	$935.25M	-200.21	-0.37%	―	7.22%	-108.99%
DNUT	46 Neutral	$539.60M	-1.05	-55.07%	3.34%	-10.40%	-1904.10%

Krispy Kreme Corporate Events

Krispy Kreme to Refranchise and Sell Japan Operations

On December 18, 2025, Krispy Kreme Doughnut Corporation agreed to sell all shares of its Japanese subsidiary, Krispy Kreme Doughnut Japan Co. Ltd., to Lei Inc., a special purpose vehicle formed by a fund of Japan-based private equity firm Unison Capital, in a deal valuing the unit based on its 2025 Adjusted EBITDA and expected to generate roughly $65 million in cash proceeds after customary adjustments. The transaction, which Krispy Kreme announced publicly on December 19, 2025 and expects to close in the first quarter of 2026 subject to standard conditions, forms the company’s first international refranchising move under its August turnaround plan, shifting its Japan operations to a franchise model under a new development and franchise agreement with Unison, and is intended to advance its refranchising strategy, strengthen financial flexibility, and reduce debt while preserving and potentially expanding the brand’s 89-store, 300-point presence in the Japanese market.

The most recent analyst rating on (DNUT) stock is a Hold with a $4.00 price target. To see the full list of analyst forecasts on Krispy Kreme stock, see the DNUT Stock Forecast page.