NEW YORK (TheStreet) -- The plan was to buy two dozen Krispy Kreme (KKD) doughnuts, and then use one dozen for a morning breakfast celebration and take the other dozen to our annual Super Bowl party, as a joke of sorts. It didn't work out that way.
Our teenage son, who swam three miles at a morning practice earlier that day, ate two or three on the ride home. The glazed doughnuts were still warm, just out of the oven, and that boy needed to replace some calories.
Admittedly, sugar-covered fried pieces of dough are not the healthiest way to go about doing that, but they were just out of the oven. Needless to say, no doughnuts made it to the Super Bowl party; it would have been odd to show up with the second box that by then was two short of a dozen.
"Two short of a dozen" is an appropriate description of Krispy Kreme's recent stock performance. Shares were hammered in early December, following the company's third-quarter earnings release. The quarter itself wasn't bad, but Krispy Kreme's earnings estimate for 2015 was short of analysts' estimates at the time and the company's stock suffered the consequences, falling 20% in one day.
Since then, the shares have continued to drift lower. They have fallen 36% since they reached a 10-year high in November.
Despite the drop, not much has really changed with Krispy Kreme. The company's turnaround remains intact, but the days of flying below investors' radar as the company had done following its near implosion in 2004-2005 until it began turning the corner the past four years are over.
The scrutiny is back, and at times so is the excitement that drove shares from $6 in June 2012 to $26.50 last November. Investors re-engaged with Krispy Kreme, and that renewed interest was not unwarranted given the company's renewed growth, solid balance sheet and improving margins.KKD data by YCharts
Now, trading at 23 times the average 2015 estimate of analysts, Krispy Kreme no longer looks expensive, especially if you believe that prospects for international growth -- the primary impetus for the company's comeback -- remain compelling.
I've owned shares during most of the past four years, and from time to time have taken some off the table when share have run up and then added after a pullback.
As a value investor, I discovered the Krispy Kreme comeback story early, and typically would have been completely out by now as the growth crowd became interested in the stock.
But Krispy Kreme seems different than many of the turnarounds I've owned. It's a compelling, well-known brand name that at this writing is still valued by the markets at just $1 billion on an enterprise value basis. (Enterprise value is a company's market capitalization plus its debt, minus its cash and cash equivalents.)
Looking longer term, that number seems ridiculously low. In the short term, however, the stock will continue to be volatile.
Now, I don't get all that excited by the coffee-play aspect of the company, or other related product releases, such as the ready-to-drink iced coffees that will be available in 900 Wal-Mart (WMT) locations beginning next week. Those are peripheral to the story, and if successful, just icing on the cake, or doughnut for that matter.
At the time of publication, Heller was long Krispy Kreme.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.