Investment grade.

• Author: Edgerton, Bobby
• Position: NC trend

* Company: Krispy Kreme Doughnuts Inc,

Ticker: KKD

Headquarters: Winston-Salem

Price May 8: $17.50

Trending (previous 30 days): (1.9)%

WHY BUY Tony Thompson, 47, former president and chief operating officer of Louisville, Ky.-based Papa John's International Inc., took over as president and CEO of Krispy Kreme this month. You can be sure he was handpicked by his predecessor, Jim Morgan, 66, who will stay on as executive chairman. The work of Morgan in saving this proud old name has been amazing. From 2004 to 2008, it lost a cumulative $405 million. How does such an iconic brand lose so much money? By bailing out losing franchises and taking on debt. Morgan became CEO in 2008, and the stock skidded to $1 a year later. Since 2010, it has earned about $ 100 million. Its balance sheet sports $66 million in cash and virtually no debt. Sales grew from $346 million in 2009 to $510 million last year. It had...