Krispy Kreme’s “Sugar High” Hides the Real Winner in This Deal
Here’s the better wealth builder …
In this issue of Investing Daily Dose (IDD):
🍔Beyond Burgers🍩
If that milkshake machine still isn’t working at your local McDonald’s Corp. MCD 0.00%↑ – and you want a better “sugar fix” than those apple pies – you’ll soon have an alternative to sub in: Krispy Kreme donuts.
What the 87-year-old, North Carolina-based donut maker started as a pilot program in Tennessee will go nationwide at Mickey D’s by the end of 2026. Glazed, chocolate iced with sprinkles and chocolate iced cream-filled donuts will be all-day menu staples – served individually or in packs of six.
If stock market winners and losers were judged by a single days’ performance, Krispy Kreme Inc. DNUT 0.00%↑ would be a no-argument winner: The shares zoomed 40% on Tuesday (the day of the announcement), one of their best days ever.
But single days aren’t how we score winners.
That’s just a “sugar high.”
One often followed by a sugar crash.
For Krispy Kreme, this is a strategy story – about a sound move that lets it connect with new customers to broaden its reach.
But the bigger winner here over the long run will probably be McDonald’s.
Demand from McDonald’s customers during the tests alone far exceeded either company’s forecasts. For the Golden Arches, adding Krispy Kreme to its lineup dovetails into a corporate plan to get a rise out of its bakery and breakfast offerings – and to “lean into” coffee.
This is all part of a bigger growth strategy for McDonald’s – one that includes product-and-marketing innovation … expansion both here in America and overseas … and artificial intelligence (AI).
This is the kind of stock too many investors overlook — or flat-out ignore — because it’s “too obvious” or because “the story seems boring.”
It’s all going to take time to play out – which is what “Wealth Builder” opportunities tend to do.
And that gives investors like us the opportunity to take our stakes now.
We have the whole story for you here.
Enjoy your weekend - we’ll see you back here on Monday.