Flowers Foods

Flowers Foods (FLO - Snapshot Report) recently reiterated its guidance for 2008 and 2009. Wall Street estimates for 2008 earnings of $1.23 per share and $1.39 per share for 2009 are in line with the company’s outlook. Analysts are seeing 21% earnings growth for 2008 and 12% growth for 2009.

Company Description

Flowers Foods produces and markets packaged bakery foods for retail and foodservice customers. Among the company's top brands are Nature's Own, Cobblestone Mill, Sunbeam, Blue Bird, and Mrs. Freshley's. Flowers Foods produces, markets, and distributes fresh bakery products that are delivered to customers daily through a direct-store-delivery system serving the Southeast, Southwest, and Mid-Atlantic. The company also produces and distributes fresh snack cakes and frozen breads and rolls nationally through warehouse distribution.

Quarterly Results Reflect Solid Growth

In early November, the company announced third-quarter earnings of 29 cents per share, surpassing the previous year’s 24 cents and beating the consensus estimate by a penny. Sales jumped 21% on a year-over-year basis.

"Sales across all categories remain strong, and we are on track to continue expanding our geographic footprint, deliver profitable growth, and drive product innovation," said George E. Deese, Chairman of the Board, Chief Executive Officer, and President. "Our performance in the quarter again demonstrates the strength of our brands and our team's ability to execute well in the marketplace.

Higher Earnings Estimates

The company recently reiterated its guidance for the year, forecasting earnings per share to be $1.22 to $1.26. Analysts are projecting $1.23 per share, which is an increase from the 2 month-ago level of $1.20. Analysts are seeing earnings growth of 21% for 2008 versus 2007.

For the 2009 year, FLO reiterated a preliminary earnings outlook of $1.33 to $1.45. Wall Street’s forecast of $1.39 per share is up from $1.37 over the past month. The earnings growth expectation for 2009 is 12%.

Favorable Industry Comparisons

Flowers Foods offers a return on equity (ROE) of 16%, exceeding the industry average of 10%. The company’s dividend yield of 2.5% stands out as most of FLO’s industry peers pay no dividend. FLO’s earnings per share are expected to grow by 10% over the next 3 – 5 years, versus the industry average of 9%.

Read the full analyst report on FLO