NEW YORK (AP) — Shares of Krispy Kreme Doughnuts Inc. plunged in premarket trading Thursday after the company lowered its outlook following disappointing second-quarter earnings and revenue.
The stock shed $2.99, or 16.9 percent, to $14.74 in premarket trading about an hour before the market open.
On Wednesday, the doughnut maker said it had to lower its outlook because of weak performance within its consumer packaged goods unit and a negative derivatives impact. The company now expects profit between 76 cents and 80 cents per share for the year, down from prior guidance of 80 cents to 85 cents per share.
Still, the company's same-store-sales, a key measure of a retailer's health, rose 5.5 percent in the U.S. International same-store sales fell 2.7 percent. Meanwhile, the Winston-Salem, North Carolina-based company announced a $50 million stock buyback program.
Wedbush analyst Nick Setyan reaffirmed a positive outlook for the company, citing its core business. He said an uptick in franchise unit growth underlines part of the company's strength and the buyback program could help boost the stock. Setyan maintains an "Outperform" recommendation with a $22 price target.