Krispy Kreme has been downgraded to a Zacks Rank #5 (Strong Sell) as analysts continue to cut earnings estimates despite some early signs of a turnaround. The consensus estimate for next quarter has fallen 14.9%, while next year's estimate has been cut by 43%, and revenues are projected to decline 13.1% this year and another 9% next year. The company's turnaround plan, focused on refranchising international markets and reducing debt, delivered a 38% increase in first-quarter adjusted EBITDA and positive free cash flow, but Wall Street remains unconvinced the improvements will translate into sustainable earnings growth. Krispy Kreme's shares have lost most of their value since returning to the public markets in 2021, weighed down by weak unit economics, slowing US growth, and a burdensome debt load, with the failed McDonald's rollout adding to its challenges.
Krispy Kreme IncEarnings estimates cut sharply, Zacks downgrade to Strong Sell.
McDonald’s Corporation