Krispy Kreme Stock Dips 77% from 2022 High: Is it Time to Buy the Dip?

Krispy Kreme's stock has experienced a significant decline of 77% from its 2022 high, with the recent bounce from the record low in June. The company's partnership with McDonald's ended, and the dividend cut has raised concerns. Despite this, Krispy Kreme is a well-known doughnut brand with a global presence and $1.66 billion in sales last year. The company aims to expand but is burdened by $1.5 billion in long-term liabilities. The stock is trading at a discount, making it a potential buy for investors looking for a bargain.

Krispy Kreme's stock has experienced a significant decline of 77% from its 2022 high, with the recent bounce from the record low in June. The company's partnership with McDonald's ended, and the dividend cut has raised concerns. Despite these challenges, Krispy Kreme remains a well-known doughnut brand with a global presence and $1.66 billion in sales last year. The company aims to expand but is burdened by $1.5 billion in long-term liabilities.

Krispy Kreme's stock, trading under the ticker symbol DNUT, has been under pressure due to several factors. The company's revenue is deteriorating, eating into already-thin profit margins. The end of its partnership with McDonald's, which was a significant revenue source, has exacerbated the situation. Additionally, the company has been facing litigation related to misleading statements about product demand at McDonald's locations, which has further eroded investor confidence [1].

The company's financial performance has been lackluster, with analysts expecting it to remain in the red for the next two years. Krispy Kreme is attempting to de-leverage its balance sheet by paying down debt, but this process is complicated by its ongoing operational overhaul. The company has also been shifting from in-house to outsourced logistics, which may increase costs in the long run [1].

Investors should be cautious when considering Krispy Kreme stock. While the stock is trading at a discount, the company's financial health and operational challenges present significant risks. The recent volatility in the stock price, driven by market sentiment and legal actions, highlights the uncertainty surrounding the company's future prospects. Despite these challenges, Krispy Kreme's long-term vision of expanding its global presence and improving operational efficiency may pay off in the future.

References:
[1] https://finance.yahoo.com/news/krispy-kreme-stock-sell-off-042300460.html
[2] https://stockstotrade.com/news/krispy-kreme-inc-dnut-news-2025_07_28/