NEW YORK (TheStreet) -- Yesterday was one of those days in the markets that there was simply not much to get excited about.We've had several of those lately, many that ended much worse than yesterday's flat performance, as investors digest their latest dose of "will we or won't we" get a deal on taxes prior to year end, and try and handicap what that deal will look like. While we await the fate of the well-known Hostess brand, shuttered operations due to a labor strike, another iconic brand, which has had its own share of troubles over the years, showed further progress on its own road to recovery. Krispy Kreme ( KKD), maker of perhaps the greatest doughnuts known to mankind (in my humble opinion, anyway), put up some great third-quarter numbers. Revenue rose a solid 8.5% to $107.1 million, better than the $104.7 million consensus estimate, and 12 cents per share earnings blew away the 7 cents a share consensus. The 6.8% same-store sales increase for the quarter represented the 16th consecutive quarterly same-store sales increase. This was a great quarter for a company that just a week and a half ago, saw its shares drop 8% in one day, as the company's largest shareholder, Mohamed Abdulmohsin Al Kharafi & Sons W.L.L. of Kuwait dumped 800,000-plus shares, or about 11% of its stake during that week. But yesterday's performance, with shares rising 23.5% on more than 10 times average volume, made that a distant memory. While it was that the company's largest seller may continue selling, there may be ample demand for those shares as investors warm up to Krispy Kreme's story. That story is a classic "rags to riches, back to rags" tale of the little doughnut maker that made a name for itself, developed a cult following, then went public. The stock soared initially, but cracks soon appeared as bad management, over-expansion and poor accounting practices nearly put the company under. Most probably forgot that Krispy Kreme was still publicly traded, as the company took several years to right the ship; closing stores, paying down debt and quietly developing an international franchise business.
There's still some skepticism out there about this company. That's not surprising given the past mistakes. The new Krispy Kreme is somewhat quietly proving that it is not only viable but that there's room for growth. The company added 20 stores during the third quarter and now has 731 stores, 635 of which are franchises. Krispy Kreme raised its 2013 outlook to 44 cents a share to 47 cents a share on $34 million to $36 million operating earnings. For 2014, the company expects to open five to 10 company-owned stores, 10 to 15 domestic franchises, and 75 international franchises. The balance sheet is still strong. Krispy Kreme ended the quarter with $50 million in cash, and just $26 million in debt. This comeback continues. At the time of publication the author is long KKD. Follow @JonMHellerCFA This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.