Shareholders have been treated to yet another quarter of double-digit profit growth from General Mills (NYSE: GIS). Yet the stock has been selling off as the economy shows signs of improving. Is there reason to worry that consumers will upgrade their eating habits and leave investors' cereal boxes empty, or are we looking at an opportunity to pour on the milk and dig in?

Let's start with the top line. Net sales for General Mills' fiscal-2010 third quarter rose by 3%, to $3.63 billion. Pricing and a favorable product mix chipped in 2 percentage points of growth, while foreign exchange rounded out the gain.

Earnings per share of $0.96, meanwhile, represent a 13% year-over-year gain. Operating cash flow was also strong, climbing by nearly 40% in the first nine months of the fiscal year.

In contrast, pound volume -- a measure of product sold -- was merely even with the year-ago period. That news may initially leave investors feeling, well, flat. But there are notable caveats.

First, divested product lines reduced volume by a full percentage point, which means that on a comparable basis, the company actually grew volume. Second, product mix skewed the figures. Basically, sales of canned vegetables and other heavier items have slipped, while lighter items such as cereal are jumping into consumers' carts.

All told, everything continues to look good with General Mills. Recently, the company announced a five-year strategic focus on demographically expanding consumer segments, including baby boomers and the emerging markets' middle classes. It's also targeting $1 billion in supply-chain savings within the next three years -- similar to competitor Kellogg's (NYSE: K) ongoing K-Lean initiative -- and a whopping $4 billion in savings across the next decade.

But not everyone shares my positive assessment. Even though management raised its fiscal-2010 EPS guidance for a second time, to reflect 15% growth excluding certain items, its dollar target fell short of analyst expectations by a few pennies. Seemingly as a result, the stock has retreated.  

Judging by media comments, investors may be concerned that General Mills' prospects will move inversely with an improving economy. Yet the notion that a strong economy is bad for packaged-food sales implies that consumers rigidly swap into and out of a fixed set of purchasing habits -- dining in vs. eating out, in this case -- as the economy waxes and wanes. Not only is such thinking simplistic, but it also directly contradicts much of the empirical consumer data.

It's true that companies such as Darden Restaurants (NYSE: DRI), the parent of Olive Garden and Red Lobster, have begun to lift expectations. Meanwhile, Panera Bread (Nasdaq: PNRA) and, to a lesser extent, Buffalo Wild Wings (Nasdaq: BWLD), have recently posted solid comps. And the likes of Chipotle Mexican Grill (NYSE: CMG) and McDonald's (NYSE: MCD) have hardly missed a step throughout the entire recession.

But I'm willing to wager that General Mills' core breakfast, snack, and baking categories continue to draw value-focused consumers, even if (and that's a sizable "if") those very same consumers decide they have the extra coin for a restaurant-prepared lunch or dinner.

Ultimately, if shares continue to go soggy, I wouldn't hesitate to pick up an entree-sized portion.