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HSBC upgrades Krispy Kreme to Buy on value shifting to equity holders

HSBC upgrades Krispy Kreme to Buy on value shifting to equity holders

HSBC analyst Sorabh Daga last night upgraded Krispy Kreme to Buy from Hold with an unchanged price target of $14. The company announced the sale of its majority stake in Insomnia Cookies and is moving towards a leaner structure, the analyst tells investors in a research note. With faster debt repayment, the firm estimates Krispy Kreme’s leverage could come closer to 3-times by the end of 2025, from 4-times currently. Deleveraging should shift value from debt to equity holders, contends HSBC.

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