Stock Pick Of The Month
Ticker Symbol: KKD (Krispy Kreme)
Recent Price: $43.03
Why? = Krispy Kreme is one of my favorite stocks. This company has proven over and over that they know how to roll out a franchise. Considering that the company is expected to grow it's EPS (earnings per share) by about 30% per year for the next several years and it's current P/E is around 47 this might seem like an expensive stock. However, you have to consider that KKD has been around for years before going public. Their franchise agreements for the USA are unavailable because they already have agreements in place with large established franchisees. This means that KKD is partnering with established companies that already know how to run a franchise. Let's consider the growth opportunities that KKD has over the next several years. Krispy Kreme is opening around 50 stores or so per year. Right now KKD has 276 stores. Think about how many stores KKD can add each year before they even begin to reach saturation in the USA. In addition to their US opportunities, they already have franchise agreements overseas, so Krispy Kreme has vast opportunities internationally as well. Essentially I see this company as in the beginning of its growth. I would guess that we are probably looking at 15-25 years of good growth maybe more. In short, buy this stock, if it goes down, buy more.
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