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Mario Gabelli Comments on Flowers Foods Inc.

- By Holly LaFon

Flowers Foods Inc. (NYSE:FLO) (0.2%) (FLO - $18.66 - NYSE) is the second-leading manufacturer and marketer in the fresh bread category. Fresh bakery is one of the largest retail categories generating $24 billion in retail sales. The bread category has undergone considerable consolidation over the last decade as the three largest manufacturers' branded products represent approximately 51% of the market. Flowers continues to shift its portfolio to faster-growing segments of the baking industry, including premium, specialty, in-store bakery and organics. In 2015, the company acquired Dave's Killer Bread, which is the leading organic bread brand in the U.S. with nearly 60% market share growing strong double-digits. In conjunction with growing sales, the company is implementing its multiyear cost savings initiatives associated with Project Centennial, which is expected to contribute to EBITDA margin improvement of 250 basis points through 2021.

From Mario Gabelli (Trades, Portfolio)'s third-quarter 2018 Gabelli Asset Funds shareholder letter.
This article first appeared on GuruFocus.