Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Krispy Kreme is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.
Krispy Kreme is one of many fad stocks that seemingly faded into permanent obscurity after a big bull run in the mid-2000s. But lately, the doughnut seller has bounced back sharply. Let's take an early look at what's been happening with Krispy Kreme over the past quarter and what we're likely to see in its quarterly report on Thursday.
Stats on Krispy Kreme
Analyst EPS Estimate
Change From Year-Ago EPS
Change From Year-Ago Revenue
Earnings Beats in Past 4 Quarters
Source: Yahoo! Finance.
Will Krispy Kreme stay hot this quarter?
Analysts have gotten somewhat more optimistic about Krispy Kreme in recent months, pushing up their consensus earnings estimates on the company by a penny per share for the just-ended quarter and by $0.03 per share for fiscal 2014. But the stock has absolutely exploded higher, rising by more than 60% just since early December.
Once known solely for its donuts, Krispy Kreme has moved beyond its former concentration. By introducing healthier items such as yogurt, the company has tried to broaden its appeal and pull in customers looking for more than just a sugar high. That's been an essential and smart strategy, with competition from rival Dunkin' Brands becoming fierce as Dunkin' has sought to expand its presence in the doughnut-and-coffee space.
One factor that has helped Krispy Kreme is the trend toward consolidation in the coffee and sweets industry. Starbucks recently bought Teavana and Tully's, while private-equity firms have taken out their share of coffee purveyors as well. Krispy Kreme may not be known for coffee, but its Signature coffee line has helped build coffee loyalty with its customer base, and so the company may look good to a potential acquirer. Yet Krispy Kreme took steps in January to dissuade acquirers by adopting a poison pill, effectively preventing a buyer from taking advantage of its carried-forward net operating losses, which are one of its most valuable assets.
In its quarterly report, watch for Krispy Kreme to discuss its recent expansion move in Taiwan. If the company can boost its international growth, then the stock could enjoy another leg up and regain more of its past glory from its boom years.
The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.
Click here to add Krispy Kreme to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.
The article Krispy Kreme Earnings: An Early Look originally appeared on Fool.com.
Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends and owns shares of Starbucks. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.