Update shared on27 Aug 2025
Fair value Decreased 22%Krispy Kreme’s consensus price target has been sharply reduced as analysts cite execution risk and weak U.S. trends following the cancelled McDonald’s partnership, with most downside already reflected in the shares, lowering fair value from $5.17 to $4.03.
Analyst Commentary
- JPMorgan sees Krispy Kreme in "survivor mode" after the cancelled McDonald's launch, with the turnaround plan carrying significant execution risk due to ongoing declines in the U.S. business.
- Bearish analysts cite limited visibility for improvement and ongoing headwinds in the core U.S. business.
- The termination of the McDonald's partnership is viewed as already priced in, with most negative impact reflected in the current share price.
- Bullish analysts note improved industry demand, a stable middle/upper income customer base, and benign input costs as mild positives, suggesting potential for a better quarter ahead.
- Margins are expected to decline further before recovering, with analysts generally cautious and advising investors to wait until business trends stabilize.
What's in the News
- Krispy Kreme is accelerating efforts to expand its presence in big-box retailers like Costco, Kroger, and Walmart, aiming to address limited availability and capture more market share in the U.S. (NYT)
- The company reported significant impairment charges for Q2 2025, including a $356 million non-cash partial goodwill impairment and $22.1 million in long-lived asset impairments. (Key Developments)
- Strategic partnerships and product innovation continue, including a Harry Potter-themed doughnut collection launching August 18, a limited-edition Crocs collaboration, and seasonally inspired products like Pumpkin Spice and Passport to Italy collections. (Key Developments)
- Krispy Kreme and McDonald's ended their partnership effective July 2, 2025, with Krispy Kreme focusing future growth on expanding through high-volume retail points of distribution and international franchise opportunities. (Key Developments)
- Leadership changes include Raphael Duvivier, formerly President, International, being named Chief Financial Officer as of July 11, 2025; the company was also added to several major Russell value indexes in late June 2025. (Key Developments)
Valuation Changes
Summary of Valuation Changes for Krispy Kreme
- The Consensus Analyst Price Target has significantly fallen from $5.17 to $4.03.
- The Future P/E for Krispy Kreme has significantly fallen from 9.31x to 7.03x.
- The Net Profit Margin for Krispy Kreme has risen slightly from 8.04% to 8.21%.
Disclaimer
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