Anthony @ Equity Investigations, Dear Anthony, Message Board

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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony,

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To: Kevin Podsiadlik who wrote (87369)	10/20/2004 8:03:41 PM
From: RockyBalboa	of 122087

I just looked at KKD again,... and there was a nasty article by the fools, likewise implying the worst (Is it time to buy now?) fool.com Krispy Kreme's Fair Value: Zero Krispy Kreme Doughnuts is down more than 80% from its high price of the year. Beset by SEC investigations, failing stores, and a floundering growth strategy, the company needs to change tack. Will it? If it fails to do so, Bill Mann sees a scenario where the losses for investors in this company go from gruesome to total. By Bill Mann (TMF Otter) September 20, 2004 ... I can hear the indignation now: "Where were you when Krispy Kreme was much higher? Now you're negative on the company?!?" Uh-huh, but this isn't a new thing: I started looking cross-eyed at Krispy Kreme in 2000. Back then people were calling it the next Starbucks (Nasdaq: SBUX). To me it smelled like something else: the next Boston Chicken. And well, well, well, here we are. While a big SEC inquiry over the company spending millions to buy back poorly performing stores from franchisees may not necessarily connote wrongdoing, it most certainly does point to a company that has lost its way. What is Krispy Kreme? .... When the current management shows its willingness to pay $32 million to bail out underperforming franchises rather than just letting them fail, you have to wonder how much of its free cash is or will be put to the benefit of shareholders.

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