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Flowers Foods, Inc. Message Board

  • rgchjr1945 rgchjr1945 Mar 26, 2013 11:21 AM Flag

    Strong Buy on Flowers Foods

    On Mar 22, Zacks Investment Research upgraded Flowers Foods Inc. (FLO) to a Zacks Rank #1 (Strong Buy). Shares of this bakery products producer have amassed an impressive return of 58.1% in the last six months.

    Why the Upgrade?

    Flowers Foods has been witnessing rising earnings estimates on the back of better-than-expected fourth-quarter 2012 results. The bakery goods producer’s earnings per share surpassed the Zacks Consensus Estimate for the first time after reporting in line earnings in 3 consecutive quarters. Moreover, we believe that the company’s strategy of expanding continuously through entering new markets, building new bakeries and acquisitions have helped induce an upward movement in the estimates.

    Flowers Foods declared impressive results on Feb 7, 2013, wherein earnings of 28 cents a share surpassed the Zacks Consensus Estimate of 25 cents by 12.0%, and rose 64.7% from the year-ago quarter.

    Net sales jumped 14.7% over the prior-year quarter to $749.4 million, and came ahead of the Zacks Consensus Estimate of $709 million. Volume increased of 10.3%, while net price/mix remained unfavorable at 2.0%. Gross margin expanded 200 basis points to 47.9%, benefiting from higher sales volumes and improved manufacturing efficencies.

    Further, the company has successfully expanded its reach of fresh bakery products from about 38% of U.S. population in 2004 to more than 70% now. Moreover, the company has a proven experience of integrating acquisitions, having completed more than 100 since 1968 and three significant ones in just the last three years – Tasty Baking, Lepage Bakeries, and the Sara Lee and Earthgrains brands in California.

    The Zacks Consensus Estimate for fiscal 2013 increased 1.6% to $1.28 per share as most of the estimates were revised higher over the last 30 days. Moreover, for fiscal 2014, the estimates were revised higher over the same time frame, lifting the Zacks Consensus Estimate by 5.8% to $1.46 per share.

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    • Flowers just announced that their 1st quarter sales were up 20-25% plus over the next few months they will be taing over existing brand sales in the whole state of CA, plus if the DOJ oks everything Hostess brands will be on the market in existing routes now, and remember Wonder alone was close to billion dollars in sales. Flowers will continue to go up and sometime this year there will be a stock split, they have the best management team of any company according to Forbes and believe me "The Flowers Way" is a proven management style.

    • Bob at The Contrarian Trader posted bearish video on FLO yesterday. He scalped a short on it yesterday but it is still on his short watch list. Watch out. I can't post a link to the video but just google The Contrarian Trader and see the Best Stock Picks post from Saturday.

      Sentiment: Sell

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