Krispy Kreme Raises FY21 Guidance; Shares Plunge 7%

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Shares of American doughnut and coffeehouse chain Krispy Kreme, Inc. (DNUT) plunged 6.9% despite the company raising its full-year fiscal 2021 guidance.

So far, DNUT shares have lost 23.9% after its IPO was issued in July 2021. Shares have been trading at a discount against the expected range of $21 to $24 per share.

Updated Guidance

Driven by strong fourth-quarter performance to date and underlying business momentum, the company increased its full-year fiscal 2021 guidance.

The company now forecasts FY21 net revenue to fall between $1.370 billion and $1.385 billion, reflecting 22% to 23% year-over-year growth. Revenue growth assumes organic growth of between 12%-13%.

Additionally, the company revised its adjusted net income outlook to fall in the range of $65 billion to $68 billion reflecting year-over-year growth of 53% to 61%.

Moreover, the company also reiterated its long-term outlook of organic revenue growth of 9% to 11% and adjusted net income growth of 18% to 22%.

Management Comments

CEO of Krispy Kreme, Mike Tattersfield, said, “Our global omni-channel business has continued to perform well as we benefit from the sharing and gifting occasions of the holiday season… Our U.S. and international businesses have both contributed significantly to our growth this quarter. We have been able to successfully pass through price increases in the U.S. in September and November addressing inflation.”

Consensus View

The DNUT stock has a Hold consensus rating based on 2 Buys, 4 Holds, and 1 Sell. The average Krispy Kreme price target of $16.17 implies 1.19% upside potential to current levels.

News Sentiment

TipRanks’ News Sentiment and Media Buzz Analysis shows the combined News Score based on DNUT’s News Sentiment and Media Buzz.

TipRanks data shows that the News Score for Krispy Kreme is currently Neutral based on 8 articles over the past seven days. 100% of the articles have a Bullish Sentiment compared to a sector average of 62%.

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