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Krispy Kreme Doughnuts, Inc. Message Board

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  • glsierra glsierra Feb 2, 2011 5:01 PM Flag

    KRISPY KREME DOUGHNUTS INC Files SEC form 8-K, Entry into a Material Definitive Agreement, Term...

    Btw, I dont think it was any accident that this was filed/announced/arranged for the first day of the new FY.

    My bet is that they want the 'benefit' of the new facility (lower int exps) to show in this new year for that much better YoY improvements in the forward quarters. Not a dumb move, necessarily, just the timing is purposeful in that regard.

    With a stated estimated savings as $3.1million or so for the new FY, it'll have about 4c EPS impact on earnings for the year. Well, actually, maybe 2-3c since there was a charge to redo the financing.

    Regardless, this deal along just added at least 2 or maybe 3c per share earnings for this new FY.

    That implies about a 75c benefit to the stock price (3c * 25 PE). So, seeing how the stock has only jumped some 20c in price since the announcement, I'd say its slightly undervalued by ~50c for the immediate valuation.

    Hope that makes sense.

14.41+0.36(+2.56%)Oct 9 4:03 PMEDT