Why Krispy Kreme Was Such a Tasty Stock in June

Key Points

• The company was added to some of the less prominent Russell indexes.

• It also announced several executive transitions.

According to data compiled by S&P Global Market Intelligence, Krispy Kreme (NASDAQ: DNUT) stock rose a sweet 25% across the trading week shortened by the July Fourth holiday. Inclusion in several new stock indexes was the key reason why, while a set of smooth C-suite transitions put some glaze on its donut.

Newly indexed

Krispy Kreme's stock, which has been a component of the influential Russell 2000 stock index, was tapped for several other equity trackers within the same family. It's now included on the Russell 2000 Value index (not to be confused with the Russell 2000), the Russell 2500 Value index, the Russell Small Cap Comp Value index, and the Russell 3000E Value index.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Image source: Getty Images.

Although landing on an index confers prestige to a stock, such a move rarely has an impact on a company's operations and fundamentals. Still, as a component of a certain index, a stock's popularity will rise simply due to the proliferation of index funds. These instruments are limited to the stocks on a particular index, so naturally, those titles get selected for the related fund or funds. But once it becomes known that a stock is graduating to an index, this dynamic is usually priced in.

C-suite shifts

Later in the week, Krispy Kreme announced a set of executive transitions. Effective July 11, it will have a new CFO -- Raphael Duvivier, its current president of international business and a long-serving company executive. He replaces Jeremiah Ashukian, who is departing for a position at an unnamed private company.

Another company veteran, Alison Holder, has been promoted from her current position of chief product officer to chief brand and product officer. Previously in her 25-year career with Krispy Kreme, she filled numerous managerial roles, including senior director of consumer insights.

To me, neither development is sufficient to tip Krispy Kreme into buy territory. Revenue has been flat to stagnant lately, and it's posted more quarterly net losses than profits. I don't see many growth paths for the business, especially in a world that is becoming increasingly health-conscious.

Should you invest $1,000 in Krispy Kreme right now?

Before you buy stock in Krispy Kreme, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Krispy Kreme wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

Now, it’s worth noting Stock Advisor’s total average return is 1,060% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 30, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.