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Krispy Kreme Doughnuts, Inc. Message Board

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  • undervalued_investments undervalued_investments Jun 16, 2006 4:20 PM Flag

    Buy KKD - The long argument

    >-KKD sales in FY2006 26% down from FY05
    -KKD sales so far in FY2007 down even more
    -Even brash CEO admits bottom not reached
    -Chairman said predicting profitability is speculation
    -go read blog
    -more bk's in FY2006<
    A lot of these reductions are a direct result that they closed bad stores. This is good!
    And as to bk, we have seen the last ones involving KKD directly. If another franchisee fails (which I don't think will happen), it won't affect KKD directly like with the others.

    >huh? so if 99 bottles of beer were on the wall, 40 fell, 59 are left, you predict that none of the 59 will fall? go read blog. <
    Another one may fail, but I don't think this is too likely. The time to fail was last year.


    >you assume franchisee revenue stabilizes. you assume no increase in LIBOR. Old ADs all need to turn around the 4000 sq.ft. factory stores otherwise bye bye. They have made this clear. they also pulling away wholesale sales from under KKD because it's not profitable to them (but to KKd it IS pure profit..so..ouch). go read blog.<
    Well, they will retrofit some of these stores slowly. It can be done.

    >go read SC report - SEC filing of 08/10/2005 (08/11?). read the entire document. Livengood will go to jail barring a miracle.<
    I glanced thrr what they published. As I recall, they pretty much blamed Tate & Livengood. I don't recall reading anything about blatant fraud. Poor decisions yes, not much more than that.

    ><<Notice also that the trends from last quarter look very, very positive.>>

    >This week buffalo store closed, wholesale being pulled out. go ask the franchisees what the trend is. most of KKD's profits come from 4-6% + markups, not company owned stores.<
    As was commented here recently, only 1-2 stores have closed in the past two quarters. I think this is very positive!

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    • undervalued_investments,

      If I was out walking thru the cyber-woods, and I came across a creature that was part "wannabe oracle", and part "condescending, college professor", I don't think I'd take what it says all too seriously. My advice, for what it's worth- "stick to your guns".

      (just in case, for clarity- the "creature" I'm referring to is certainly not you)

      • 1 Reply to bluehorseshoe12
      • >If I was out walking thru the cyber-woods, and I came across a creature that was part "wannabe oracle", and part "condescending, college professor", I don't think I'd take what it says all too seriously. My advice, for what it's worth- "stick to your guns". <

        What?? I'm just trying to articulate as best as I can why someone should buy this (very speculative) stock! I'm posting just my opinions! I may be right or wrong, but isn't the purpose of this board to express your opinions and test your arguments, preferably with someone from the "other" side?
        I don't profess to know everything. In fact, I probably know nothing! So nevermind and don't buy this stock!

    • <<A lot of these reductions are a direct result that they closed bad stores.>>

      I think I mentioned sales becuase you did. don't turn things around on me. Ok now you want a real challenge? EBITDA and CEBITDA. Down probably 90%+ from 2004. Explain to me how this is supposed to work.

      <<Another one may fail, but I don't think this is too likely. The time to fail was last year.>>

      did you read the blog in its entirety - yes or no? ....look...the only way you can be successful is if you re-question your assumptions all the time. if you wanna convince yourself that you are right it's fine but you won't convince people like us who have been putting hours every week for 1-2 years into this stock if you do not expand your knowledge.

      Challenge for you: analyse KKSF (KK South Florida). Explain to me how this entity will avoid liquidation.

      <<Well, they will retrofit some of these stores slowly. It can be done.>>

      by Brewster? by Cooper? if can be done why have they lifted 0 fingers in 18 months? have you ever analysed a corporate turnaround before? if you did, you'd know the difference between management that wants/knows to turn around and management that does not.

      <<I glanced thrr what they published. As I recall, they pretty much blamed Tate & Livengood. I don't recall reading anything about blatant fraud. Poor decisions yes, not much more than that.>>

      glancing at women on the street is fine, but not at SC reports. You have soooo not read the report my friend. Key phrase: "one penny per share". Key word: "restatements". Misstating profitability deliberately is a criminal matter. not civil. criminal. And the SC says that Livingood did that.

      <<As was commented here recently, only 1-2 stores have closed in the past two quarters. I think this is very positive! >>

      i think its negative. closing stores requires an unusual 1-time cash outlay, did you know that? franchisees have many reasons for why they cannot close closes including Cooper flat out veto'ing it because he wants the royalties, and going dark problems etc. Go read the blog.

      Look as I said you are very smart, but now, until you read the following documents in their entirety, there is no point of continuing the debate.

      a) loan docs and ammendments
      b) GCFF blog
      c) SC report
      d) 10-K

      trust me, i'm not being mean. i read them. they make all the difference.

      • 1 Reply to meme4564564
      • undervalued_investments undervalued_investments Jun 17, 2006 11:47 PM Flag

        >I think I mentioned sales becuase you did. don't turn things around on me. Ok now you want a real challenge? EBITDA and CEBITDA. Down probably 90%+ from 2004. Explain to me how this is supposed to work.<
        Look, I don't profess to know everything. My decision to buy was triggered by what I saw in the press release this week. I'm sure things were pretty bad in the past, but this week I saw the light at the end of the tunnel.

        >did you read the blog in its entirety - yes or no? ....look...the only way you can be successful is if you re-question your assumptions all the time. if you wanna convince yourself that you are right it's fine but you won't convince people like us who have been putting hours every week for 1-2 years into this stock if you do not expand your knowledge.<
        No, I haven't read the entire blog. But I did read the part where the blogger doesn't think KKD will go bk. I think he has better insights and knowledge than many of us on this board, don't you think?

        >Challenge for you: analyse KKSF (KK South Florida). Explain to me how this entity will avoid liquidation.<
        Don't know much about them. Where can I find info?

        ><<Well, they will retrofit some of these stores slowly. It can be done.>>

        by Brewster? by Cooper? if can be done why have they lifted 0 fingers in 18 months? have you ever analysed a corporate turnaround before? if you did, you'd know the difference between management that wants/knows to turn around and management that does not.<
        It takes time and money.
        Look, I understand right now KKD is in survival mode. They apparently are out of credit and only have the $19 Million or so to play around. They think that amount is sufficient, fine with me! But things at least for last quarter looked stable. Give them a few more quarters and they will bring the ship up little by little.

        >glancing at women on the street is fine, but not at SC reports. You have soooo not read the report my friend. Key phrase: "one penny per share". Key word: "restatements". Misstating profitability deliberately is a criminal matter. not civil. criminal. And the SC says that Livingood did that.<
        That may be, but so what? Really. Livengood is gone. He is the sacrificial lamb (rightly so). KKD can't pay for his mistakes. Who will force them to?

        >i think its negative. closing stores requires an unusual 1-time cash outlay, did you know that? franchisees have many reasons for why they cannot close closes including Cooper flat out veto'ing it because he wants the royalties, and going dark problems etc. Go read the blog. <
        OK, some stores I'm sure are bad, but the aggregate seems to be ok. They will close them slowly, when their leases are up. Minimal expense. Seems like they have the time and money to wait until the right moment.

        >Look as I said you are very smart, but now, until you read the following documents in their entirety, there is no point of continuing the debate.<
        You are overestimating me! Look, I liked what I saw and my overall impression is KKD will be fine (why would someone fund them with a $225M loan otherwise? If they wanted the company, they could have gotten it a long time ago).
        .

 
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