Shares of Krispy Kreme (NASDAQ:DNUT) stock start trading today, with investors hoping the initial public offering will do for their bottom line what the chain’s delicacies do for the waist line.
They may be disappointed, though, as the offering priced at $17 per share of DNUT stock, well below the expected $21-$24 range. The Krispy Kreme IPO raised about $500 million.
This isn’t Krispy Kreme’s first visit to Wall Street, either. It was a public company until 2016 when Germany’s JAB Holding acquired it. It first went public in 2000 but its unit had to file for Chapter 11 bankruptcy in 2005.
DNUT Stock Listing Comes as America Sees Health Challenge
Krispy Kreme sold 1.3 billion donuts across 30 countries in fiscal 2020, a record year for the 84-year-old brand, with net revenues of $1.1 billion. In its most recent quarter, ending April 4, Krispy Kreme’s revenue jumped 23% to $321.8 million. Its net loss narrowed to $378,000. The company’s total debt stood at around $1.2 billion at the time of the report.
Rivals range from Dunkin’ Brands, which exited from the public markets last year after it was bought by private-equity-backed Inspire Brands, to Starbucks (NASDAQ:SBUX).
The new listing of DNUT stock comes just days after researchers reported that the rates and severity of Type 2 diabetes among U.S. children rose during the Covid-19 pandemic, possibly due to weight gain during lockdowns.
Research led by Dr. Daniel Hsia, an associate professor in the clinical trials unit at Pennington Biomedical Research Center in Baton Rouge, Louisiana, found that kids saw less physical activity, more screen time and other sedentary behaviors, sleep disturbances, and increased consumption of processed foods, all of which contribute to weight gain.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News and as a buyside equity research editor. His Substack newsletter, TLV Strategist, covers the Israel business scene.