Bakery company Flowers Foods (NYSE:FLO) released fourth-quarter numbers on Thursday, boosted its 2007 guidance, and then stood back and watched its share price rise. I must say I find this small- to medium-cap stock interesting (its market cap is $1.8 billion; different folks have different opinions about capitalization cutoffs).

For the 12-week quarter, the company reported sales of $438.2 million, an increase of 10.5% over the $396.5 million for the quarter a year ago. Net income from continuing operations was $15.8 million, a 35% jump from the $11.7 million in the year-earlier quarter. Per-share diluted income was $0.26, up 36.8% from $0.19.

For the full year, Flowers' revenues were $1.89 billion, up 10.1% year over year. Its net income climbed 32.4% to $81 million, or $1.31 per diluted share. Before the effect of an accounting change, Flowers' income per share from continuing operations was $1.21 versus $0.99 for fiscal 2005.

In announcing his company's results, Flowers CEO George E. Deese said, "Our earnings performance is evidence that our business model is sound. Our brands are strong, our bakeries efficient, and our direct-store-delivery network is providing extraordinary service. As 2007 unfolds, we expect another year of solid performance ... "

The company's 2007 guidance includes revenues of $1.98 billion to $2.04 billion, an increase of 5% to 8%. Per-share income is projected to be $1.33 to $1.43, an increase of about 10% to 18% over 2006 results.

Flowers, which is based in Thomasville, Ga., produces packaged foods including the Nature's Own, Cobblestone Mill, ButterKrust, Flowers, and Betsy Ross brands, along with regional franchised brands Sunbeam and Bunny. Its peers include Campbell Soup (NYSE:CPB), Interstate Bakeries, and Lance (NASDAQ:LNCE).

As I consider Flowers, especially in light of its solid quarterly and 2006 full-year results, I am struck by several factors about the company and its financials, not the least of which is its 0.58 beta -- the degree to which its stock price tends to fluctuate compared with the overall market. A level as low as Flowers' becomes more attractive, given the possibility of a market correction this year. At the same time, its actual performance in 2006, along with its projected revenue and earnings growth, are attractive, as is its strong balance sheet, which includes a 0.20 level of total debt to equity.

Frankly, I'm intrigued by Flowers Foods. Any way you slice it, I believe the company's stock should be on the radar screen of Fools with a bent for companies in its market cap range.

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Fool contributor David Lee Smith does not own shares in any of the companies mentioned. He welcomes your comments or questions. The Motley Fool has a disclosure policy that loves baked goods.