NEW YORK Investment funds affiliated with Nelson Peltz, the well-known activist investor and nonexecutive chairman at Wendy’s/Arby’s Group Inc., have snatched up stock in quick-service and snack brands, and dumped holdings in casual-dining companies.
According to the latest filings from Peltz’s various Trian funds, which covered holdings as of Dec. 31, Krispy Kreme Doughnuts Inc. and CKE Restaurants Inc. are in, while P.F. Chang’s China Bistro Inc. and The Cheesecake Factory Inc. are out.
Trian currently holds about 2 percent of Krispy Kreme shares, or about 1.5 million of the doughnut franchisor’s 67.5 million outstanding shares. At CKE, which franchises the Carl’s Jr. and Hardee’s burger chains, Trian holds about 4 percent of corporate shares, or 2.2 million of the 54.6 shares outstanding.
Peltz, well known for his role in merging Wendy’s and Arby’s into Wendy’s/Arby’s Group Inc. late last year after a prolonged battle with Wendy’s management, also has invested in — and stirred the pot at — McDonald’s Corp. and Cracker Barrel’s parent company. Last year Trian funds held small stakes in both The Cheesecake Factory and P.F. Chang’s, but those positions were liquidated as of this latest February filing with the Securities & Exchange Commission.
Krispy Kreme has a storied corporate history, as the once high-flying stock now trades around $1 amid numerous restaurant closures, negative sales trends and declining profits. The 520-unit chain is now looking abroad for the majority of its growth. Winston-Salem, N.C.-based Krispy Kreme took a turn for the worse beginning in 2004, when company officials were accused of inflating corporate results, same-store sales began to plummet as the low-carb fad took off, and many said the chain also fell victim to overextended growth.
Krispy Kreme stock has traded between $5.65 and $1.01 per share during the past 52 weeks.
Carpinteria, Calif.-based CKE Restaurants has weathered the current economic storm better than most, and its sales remain positive at Carl’s Jr. and sister brand Hardee’s. The company’s chains, which together total 3,110 locations, focus on premium, more expensive burgers, like the Six Dollar Burger at Carl’s Jr. and the Thickburger at Hardee’s.
CKE’s stock has traded between $14.45 and $4.88 per share during the past 52 weeks.