America's anti-obesity craze, courtesy of GLP-1-based weight-loss drugs such as Wegovy and Mounjaro made by Novo Nordisk and Eli Lilly, continues to gain momentum as yet another Wall Street bank loses faith in obese consumers. 

On Monday, Truist Securities downgraded doughnut chain Krispy Kreme Inc. from "buy" to "hold" and slashed the price target from $20 to $13, citing GLP-1 trends. 

Analysts led by Bill Chappell told investors:

"We believe the stocks will be stuck in a holding pattern at best with strong potential for additional multiple contraction as the initial impact of GLP-1 use becomes more apparent. To be clear, we have NO IDEA what the impact of GLP-1s will be on overall food consumption, but we believe it is way too early in the cycle for anyone to have an accurate estimate."

Chappell said he needs more evidence to gauge the overall GLP-1 impacts on overall food consumption. He noted if GLP-1 impacts worked through Krispy Kreme and its peers in the third quarter - there would be enough data to forecast 2024-25 trends. 

Chappell warned that GLP-1 overhang will weigh shares down for the next six to 12 months, "if not longer." 

He added: 

"We believe the stocks will be stuck in a holding pattern at best with strong potential for additional multiple contraction as the initial impact of GLP-1 use becomes more apparent." 

Shares of Krispy Kreme fell as much as 3.6% in early New York trade, but most losses were recovered by early afternoon. Shares are up 24% on the year but remain around record lows.