NEW YORK (TheStreet) -- Glazed doughnut maker Krispy Kreme (KKD) will report fiscal first-quarter 2016 results Wednesday after the closing bell. You should stay away because itis not looking like such a sweet investment these days.

Its shares, currently trading at $17.33, are down over 12% for the year to date compared with close to 1% gains for the S&P 500 (SPX). Expand the horizon to six months, and KKD stock has lost 14% of its value. In other words, the Winston-Salem, NC.-based restaurant chain, whose fiscal-year 2015 earnings declined more than 8%, has a lot to do to make its shareholders whole. 

In its past seven reporting periods, KKD has missed analysts' average earnings estimates four times and matched estimates twice. One would have to go all the way back to December 2013 (fiscal third quarter) to find the last time KKD posted an earnings beat. Revenue during that span has fallen shy of estimates five times.

What is clear is competition from larger rivals Starbucks (SBUX) and Dunkin Brands (DNKN) continues to pressure Krispy Kreme's business. To better compete, Krispy Kreme has taken on an aggressive expansion strategy, including adding 53 new stores last quarter, which brought its total U.S. store count to 709.

But this growth initiative, which included a 19% spike in systemwide stores (well over 900 units), is expensive to maintain as evidenced the 20% year-over-year increase in general and administrative expenses for last quarter. General and administrative expenses accounted for 7.4% of revenue, compared to 6.8% for the fourth quarter of fiscal year 2014.

Can KKD start its 2016 fiscal year on the right foot with an earnings beat Wednesday? Even if it does beat estimates, it doesn't immediately make KKD stock attractive. At 39 times trailing earnings, against an average P/E of 21 for the S&P 500, the price is steep for a stock where earnings took a step backward in the last fiscal year.

At such a steep valuation multiple, one would expect top-notch execution from Krispy Kreme. But that's not what the company has delivered. Krispy Kreme seems willing to sacrifice near-term profits for long-term growth. There's nothing wrong with that. But with shares down 17% in six months, the market doesn't appear to be on board with this strategy. KKD doesn't pay a dividend so it's tough to suggest patience.

It makes more sense to own market leader Starbucks, which is not only trading at a cheaper multiple of 30 but investors can collect an annual dividend yield of 1.20%. Likewise, shares of Dunkin' Brands are also cheaper, trading at a P/E of 30. Even better, DNKN pays a decent yield of 2%.

This article is commentary by an independent contributor. At the time of publication, the author held no shares in any of the stocks mentioned.