Soumya Eswaran
4 min read
In This Article:
Maple Tree Capital, an investment management company, released its Q1 2025 investor letter. A copy of the letter can be downloaded here. Q1 2025 saw a strong start but turned sour due to tariff concerns and macroeconomic fears, leading to a sharp market pullback, with the Nasdaq falling nearly 22% from its highs and the S&P 500 down 20%. Despite the challenges, the firm made significant progress this quarter by averaging in the top-conviction stocks, utilizing covered calls, and exercising patience. Maple’s growth-oriented fund, Jonagold, has become a standout performer, greatly surpassing all major benchmarks since its launch in 2023. While Heartwood is still facing difficulties. Maple Tree Capital’s Jonagold returned -13.64% in Q1 compared to the Nasdaq’s -10.26% return and the Russel 2000’s -9.48% return. Maple Tree Capital’s Heartwood returned -18.04% in Q1 vs. the S&P 500’s -4.27% and the Dow Jones’ -0.87% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Maple Tree Capital highlighted stocks such as Krispy Kreme, Inc. (NASDAQ:DNUT). Krispy Kreme, Inc. (NASDAQ:DNUT) is a doughnut company based in Charlotte, North Carolina. The one-month return of Krispy Kreme, Inc. (NASDAQ:DNUT) was -29.02%, and its shares lost 71.25% of their value over the last 52 weeks. On May 28, 2025, Krispy Kreme, Inc. (NASDAQ:DNUT) stock closed at $2.91 per share with a market capitalization of $497.028 million.
Maple Tree Capital stated the following regarding Krispy Kreme, Inc. (NASDAQ:DNUT) in its Q1 2025 investor letter:
"We have undoubtedly been wrong on Krispy Kreme, Inc. (NASDAQ:DNUT). Since we started our position in March, the stock has gone down, vertically. And, on top of that, we initiated this in size. A pure double whammy to the downside, and the most significant negative impact on our performance. While the McDonald’s rollout has been slower than expected, Krispy Kreme still has that deal in place, with a very strong national brand. The stock is caught up in recession fears, high debt and ozempic fears adding fuel to the fire. Short sellers have gotten particularly interested in this stock, and a cyber-attack that occurred in Q4 caused Krispy Kreme to miss its sales and profitability estimates, further sinking shares. We think that while these headwinds are real, the stock has been punished far too much. This is a kitchen sink.
