Flower Foods May Be the Dividend Stock You've Been Craving

FLO just paid its 74th consecutive dividend

Mar 25, 2021 at 10:29 AM
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Flowers Foods, Inc. (NYSE:FLO) is one of the largest producers of packaged bakery foods in the United States. The company operates 46 bakeries that produce a wide range of bakery foods for retail and food service customers in the U.S. At last check, the equity was flat in pre-market trading.

Flower Foods stock offers a forward dividend of $0.80 and a dividend yield of 3.33%. FLO recently paid out its 74th consecutive quarterly dividend on March 19. Overall, Flower Foods stock is a promising dividend option for long-term investors. The company has made giving back to its shareholders a priority. Given the dividend history to date, investors can probably expect some sort of dividend growth on an annual basis going forward.

Flowers Foods stock price has increased 20% year-over-year and has grown 35% since its 52-week low of $17.42. Additionally, FLO is up just 2.4% year-to-date. Shares of Flower Foods stock currently trade just 7% below their 52-week high of $25.18.

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Like its stock growth, Flowers Foods has had a slow but consistent increase in revenues. Since fiscal 2017, FLO has grown its sales by 12%, with fiscal 2020 being its best year in recent calculations. This past year, Flower Foods increased revenues by 6.4%, bringing its total sales up to $4.4 billion. The biggest investor concern for Flower Foods lies in its balance sheet, which currently holds $1.32 billion in debt and only $307.48 million in cash. Flower Foods also saw a 7.6% decrease in net income for fiscal 2020. Prior to 2020, FLO grew its net profits by 9.7% between fiscal 2017 and fiscal 2019.

In recent history, FLO has beat expectations four out of four times over the past year. Since the first quarter of 2020, Flower Foods outperformed Wall Street expectations for the stock consistently, even if it was by a small margin each time. While earnings dropped each quarter in 2020, the company still outperformed expectations on a consistent basis and is expected to report an increase in earnings for the first quarter of 2021.

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