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5-Star Stocks Poised to Pop: Flowers Foods

By Brian D. Pacampara, CFA - Updated Apr 6, 2017 at 9:37PM

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Market-trouncing returns could be written in this five-star.

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, bakery goods company Flowers Foods (NYSE: FLO) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Flowers' business and see what CAPS investors are saying about the stock right now.

Flowers facts

Headquarters (founded) Thomasville, Ga. (1934)
Market Cap $2.93 billion
Industry Processed and packaged goods
Trailing-12-Month Revenue $2.58 billion
Management

Chairman/CEO George Deese

CFO Steve Kinsey

Return on Equity (average, past 3 years) 18.4%
Cash/Debt $8.7 million / $121.8 million
Dividend Yield 2.5%

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 97% of the 345 members who have rated Flowers believe the stock will outperform the S&P 500 going forward. These bulls include scavanna and mercyn

Earlier this year, scavanna succinctly summed up the Flowers bull case: "sales and profit growth, good balance sheet and ... dividend growth."

Over the past five years, in fact, Flowers has grown its dividend at a brisk rate of 24.6% annually. That's much faster than food giants such as General Mills (NYSE: GIS) (10.5%), Kraft (NYSE: KFT) (5.3%), and Unilever (NYSE: UL) (6.2%).

CAPS member mercyn expands on the tasty opportunity:

Steady growth internally and through acquisitions -- just completed purchase of TastyKake company out of Philadelphia. Company does not distribute nationally yet -- currently products mainly in Southeast, MidAtlantic states. Lots of potential for increased distribution and new product acquisitions.

What do you think about Flowers, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

Flowers Foods, Inc. Stock Quote
Flowers Foods, Inc.
FLO
$25.68 (-0.23%) $0.06
Kraft Foods Group, Inc. Stock Quote
Kraft Foods Group, Inc.
KRFT.DL
General Mills, Inc. Stock Quote
General Mills, Inc.
GIS
$64.44 (0.34%) $0.21
Unilever PLC Stock Quote
Unilever PLC
UL
$52.62 (2.58%) $1.32

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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