Krispy Kreme's Insomnia Divestiture May Not Boost Core Focus As Expected: Analyst Weighs In
Portfolio Pulse from Shivani Kumaresan
Krispy Kreme Inc (NASDAQ:DNUT) is seeking strategic alternatives for its Insomnia Cookies business to focus on its core strategy of producing, selling and distributing fresh doughnuts daily. However, Truist Securities analyst Bill Chappell, who reiterated a Buy rating on DNUT with an unchanged price target of $20, is unsure how divesting the business will improve the focus on the core as Insomnia has been accretive to DNUT's top line growth rate.
October 04, 2023 | 6:15 pm
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Krispy Kreme's plan to divest Insomnia Cookies may not improve its focus on the core business as expected, according to an analyst. The move could potentially impact DNUT's top line growth rate.
Krispy Kreme's decision to divest Insomnia Cookies is aimed at focusing on its core business. However, since Insomnia has been contributing to DNUT's top line growth rate, the analyst is unsure how this move will improve the company's focus on the core business. This uncertainty could potentially impact investor sentiment and DNUT's stock performance in the short term.
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