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Krispy Kreme Doughnuts, Inc. Message Board

  • dollars2donuts dollars2donuts May 11, 2000 6:51 PM Flag

    Add'l info on SONC (Sonic Drive-Ins)

    Sonic (SONC) and KREM are very similar companies,
    with the notable exception that Sonic went public ten
    years ago before people got all misty-eyed about IPO's.
    Therefore, it took SONC seven years to experience the 150%
    premium over the IPO price that KREM has received in six
    weeks.

    But if you compare their past five years financials
    at www.freeedgar.com, you'll see that over the past
    five years they have been almost twins (again with the
    notable exception that Sonic is able to make about 5
    times the net income on the same revenue base). Also,
    if you check Yahoo or Multex, you'll see that future
    growth prospects are similarly rosy (expectations of 25%
    a year growth for the next five years). You'd also
    find out that even with that income that if 500%
    greater, th market cap is roughly 2/3 of KREM's.

    Of
    course, SONC doesn't have the cult following to sop up a
    relatively low float (for now) and bid the stock up to the
    sky. The question is what will happen when the other 9
    million shares are dropped on the market. I sure hope I
    can get some more shares to short, this puppy is
    going to sink like a rock...

 
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