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Krispy Kreme Doughnuts, Inc. Message Board

  • __PlayingTheGame __PlayingTheGame Feb 18, 2005 12:59 PM Flag


    KKD is still over $6? But everyone (at least almost everyone here) says it will be BK soon! WHY would anyone be buying?? And here I though we had this all figured out!!

    .....Oh that's right, it's all Short covering!!

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    • I don't know why the shorts would be covering when most of them beleive the stock is going Bankrupt.There is no volume,and hence no conviction to this rally,it's only a slight reaction.

    • I was afraid you were going to ask that. Nothing concrete to give you, just a gut feeling. I've been "playing this game" for many years now (more than I care to admit) and I smell something fishy going on here. Somebody just posted (too lazy to look up) that they thought the fair value should be around $2. I agree. So why is this $6?? Something is missing here. So if I got in the game here, it would be Long.

    • "Based on entry points, I am sure most shorts would have no problem with a runup (very unlikely) to $9, or even $12. The current price is just icing on the cake. No need to cover until at least the end of March"

      Sorry, I don't buy that. That's like the gambler who says, "I can't lose now, I'm playing with casino's money"! WRONG! Once it's your money its just that, YOUR MONEY! To continue to short at this point you must ask yourself, honestly, "If I was able to Short this at the current price would I" or would I say, "Too late to Short, the price has already fallen".

    • Your gut feeling is interesting,because my gut feeling,and head tell me the odds are in favor of the shorts.RE:NO open credit facility,they need more money to operate b-4 Mar. 25th.Former management has cooked the books.We just don't know how bad yet.Shareholder lawsuits,declining profits,stores need to be closed which will take money.Time is running out on delivering financials.If they can't NYC is sure to delist into no mans conviction on longs part(No Volume)IBD says KKd is under heavy distribution.Chart is trading below it's moving averages in a downtrend.Hell I could end up being wrong-I've been wrong before,it's just that the current conditions are not favorable for any sustained rally.If it smells like a dog,and looks like a dog,then itsa........I hope your donut doesn't crumble.Babe

    • Never underestimate the power of greed

    • "I hope your donut doesn't crumble"

      If it does, it won't be the first time LOL!

      Good luck to you.

    • __PlayingTheGame:

      I won't press you on your gut feel and respect you for it. KKD's lack of collapse to date cannot be dismissed out of hand, no matter how remote the possibility of a rational explanation. Once again the spectre of a Black Swan rears its ugly head.

      Were I to add to the list of reasons why Krispy won't go broke, the best I can come up with are the possibilities that Cooper lied when he reported the cash squeeze, that there is an irrational or bribed buyer in the offing, and that Di_vur_se_fi is badly mistaken in his analysis.

      You mention taking money off the table. For myself, I saw the risk/reward two months ago as extraordinarily positive; today after substantial gains, much less risky but still strongly favorable.

      Yet your question remains.....

    • It's fair to ask why the stock sells for $6, when fair value looks more like $2 (the ballpark I would put it in, if it doesn't go bankrupt). But one could equally have asked why it was selling for $49, when fair value was around $15 even if the anomalies di_vur_se_fi had found in the books were assumed to be inconsequential.

      As a general rule, it seems to me, one will do better in the stockmarket if one buys stocks that are worth $6 and sell for $2 than if one buys stock that are worth $2 and sell for $6. So why do you think the risk-reward is on the long side?

    • The flaw in your argument is you ASSume everyone agrees with your perception of the stock price. Guess what? They don't. I think KKD is worth no less than 10 bucks. That's only 17x last year's earnings if you agree that the restatement will be 8c/share. That isn't expensive for a company that analysts say will grow 16.3% per year for the next five years. It's only a PEG of 1.04 vs the industry avg of 1.96. Once the BK hype is proven to be bogus shit spread by short sellers through the media and message boards like yahoo the stock will trade to 10 and higher. That's when the restructuring talk will start and the stock will trade to the upper teens. You'll still be here with your foot in your mouth saying "I'm not covering because it's going BK. I have loaddddddddddsssssssss of profits and I can't lose. I'm a short God and can't be wrong." blah blah blah

    • <I may be FOS, but my KKD positions have been working great for me.>

      You are FOS, and you're conveniently leaving out your Feb 5 puts that are about to expire worthless.

      I was selling those overpriced puts about the same time you, the alleged options expert, was buying them. Pretty funny.

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