Financial Performance - Flowers Foods reported quarterly earnings of $0.35 per share, missing the Zacks Consensus Estimate of $0.38 per share, and down from $0.38 per share a year ago, representing an earnings surprise of -7.89% [1] - The company posted revenues of $1.55 billion for the quarter ended March 2025, missing the Zacks Consensus Estimate by 3.04%, and down from $1.58 billion year-over-year [2] - Over the last four quarters, Flowers Foods has surpassed consensus EPS estimates three times but has not beaten consensus revenue estimates [2] Stock Performance - Flowers Foods shares have lost about 17.4% since the beginning of the year, while the S&P 500 has gained 0.6% [3] - The current Zacks Rank for Flowers Foods is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.32 on $1.3 billion in revenues, and for the current fiscal year, it is $1.18 on $5.43 billion in revenues [7] - The estimate revisions trend for Flowers Foods is mixed, and changes in estimates for the coming quarters and current fiscal year are anticipated following the recent earnings report [6][7] Industry Context - The Zacks Industry Rank for Food - Miscellaneous is currently in the bottom 40% of over 250 Zacks industries, which may impact the performance of Flowers Foods [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that industry outlook can materially affect stock performance [5][8]

Financial Performance - Net sales decreased 1.4% to $1.554 billion, with pricing/mix down 0.3% and volume down 2.7%, while the Simple Mills acquisition contributed 1.6%[6] - Net income decreased 27.4% to $53.0 million, representing 3.4% of sales, and diluted EPS decreased $0.09 to $0.25[6] - Adjusted EBITDA increased 1.6% to $162.0 million, representing 10.4% of net sales, a 30-basis point increase[6] - Net sales for the 16-week period ended April 19, 2025, were $1,554,230, a decrease of 1.4% compared to $1,576,818 for the same period in 2024[26] - Branded Retail sales decreased by 0.4% to $1,011,273 from $1,015,130 year-over-year[30] - Adjusted net income per diluted common share for the 16-week period ended April 19, 2025, was $0.35, down from $0.38 in the prior year[34] - EBITDA for the 16-week period ended April 19, 2025, was $134,518, compared to $149,941 in the prior year, reflecting a decline in profitability[39] - Adjusted net income for the 16-week period ended April 19, 2025, was $73,706, down from $80,261 in the prior year[43] - The gross margin for the 16-week period ended April 19, 2025, was $748,400, slightly lower than $753,279 in the prior year[36] Future Guidance - The company expects net sales for Fiscal 2025 to be between $5.297 billion and $5.395 billion, representing 3.8% to 5.7% growth compared to the prior year[7] - Adjusted diluted EPS is projected to be approximately $1.05 to $1.15, compared to prior guidance of $1.11 to $1.24[7] - The company provided full-year fiscal 2025 guidance for net income per diluted common share in the range of $0.95 to $1.05[43] Acquisitions and Strategic Moves - The acquisition of Simple Mills contributed $24.3 million in net sales but resulted in a net loss of $4.2 million[6] - The acquisition of Simple Mills was highlighted as a strategic move to enhance market presence and product offerings[20] - The company experienced a 2.4% increase in net sales due to acquisitions, contributing positively to overall sales performance[36] Expenses and Costs - Selling, distribution, and administrative expenses were 40.8% of net sales, a 110-basis point increase due to higher workforce-related costs[11] - Selling, distribution, and administrative expenses (SD&A) were $633,513 for the 16-week period ended April 19, 2025, compared to $625,251 in the prior year[37] - The company incurred restructuring charges of $573 and plant closure costs of $7,397 during the 16-week period[26] Cash Flow and Assets - Cash flow from operating activities increased by $30.5 million to $135.6 million in the first quarter[10] - The company reported a net cash provided by operating activities of $135,634, an increase from $105,149 in the prior year[28] - Cash and cash equivalents at the end of the period were $7,340, up from $5,005 at the beginning of the period[28] - Total assets increased to $4,326,946 as of April 19, 2025, compared to $3,400,447 at the end of the previous fiscal year[23] - Long-term debt rose significantly to $1,790,379 from $1,021,644, indicating increased leverage[23] Capital Expenditures - Capital expenditures are expected to be approximately $140 million to $150 million, with $4 million to $6 million related to an enterprise resource planning system upgrade[7]

Financial Performance - Q1 2025 - Net sales decreased by 1.4% year-over-year to $1.554 billion, influenced by softer volumes and negative price/mix, but partially offset by the Simple Mills acquisition[8, 11] - Net income decreased by 27.4% year-over-year to $53.0 million, primarily due to lower operating income, higher net interest expense, and a higher income tax rate[8, 14] - Adjusted EBITDA increased by 1.6% year-over-year to $162.0 million, driven by improved gross margin and lower adjusted SD&A, partially offset by decreased net sales[8, 14] - GAAP diluted EPS decreased by $0.09 to $0.25, while adjusted diluted EPS decreased by $0.03 to $0.35[8] Sales Breakdown - Branded Retail net sales declined by 0.4% due to volume declines and unfavorable price/mix resulting from increased promotional activity, partially offset by the acquisition contribution[11] - Other net sales decreased by 3.3% due to softer volumes across most categories as inflationary pressure on consumers resulted in weaker away-from-home category sales[11] - Price/Mix had a -0.3% impact on total net sales, Volume had a -2.7% impact, and the Acquisition contributed +1.6%[8, 13] Fiscal Year 2025 Guidance - Net sales are projected to be between $5.297 billion and $5.395 billion, including $218 to $225 million from Simple Mills[19] - Adjusted EBITDA is expected to be between $534 million and $562 million, including $30 to $33 million from Simple Mills[19] - Adjusted diluted EPS is forecasted to be between $1.05 and $1.15, including a negative impact of ($0.08) to ($0.07) from Simple Mills[19]

Core Insights - Flowers Foods, Inc. (FLO) is expected to report revenue growth of 1.7% year-over-year, with a consensus estimate of $1.6 billion for the first quarter of fiscal 2025 [1] - The earnings consensus has increased to 38 cents per share, matching the prior-year quarter's figure, with a trailing four-quarter earnings surprise of 4.7% on average [2] Group 1: Performance Factors - The company's focus on core priorities, including team development, brand concentration, margin prioritization, and strategic mergers and acquisitions, has positively impacted its performance [2][3] - FLO is executing a portfolio strategy by exiting low-margin businesses and replacing them with higher-margin opportunities, enhancing its cost structure, and investing in brands to drive volume and market share [3] Group 2: Market Dynamics - The fiscal first-quarter results may reflect challenges from a shifting consumer environment, including changes in spending behavior and increased costs due to heightened promotional activities [5] - Despite the broader food industry benefiting from increased at-home consumption, FLO faces headwinds in key categories, particularly in cake, leading to a projected 1.1% decline in overall volumes for the quarter [5] Group 3: Brand Performance - Management highlighted strong volume gains for core bread brands, including Dave's Killer Bread, Wonder, and Canyon, with Nature's Own's premium line also showing unit growth due to sustained demand [4] - The successful implementation of the portfolio strategy is likely to have contributed to the company's performance in the upcoming quarter [4]

Core Viewpoint - Wall Street anticipates flat earnings for Flowers Foods (FLO) in the upcoming quarter, with revenues expected to increase slightly, but actual results will significantly influence stock price movements [1][3]. Earnings Expectations - Flowers Foods is projected to report earnings of $0.38 per share, unchanged from the previous year, with revenues estimated at $1.6 billion, reflecting a 1.7% increase year-over-year [3]. - The consensus EPS estimate has been revised down by 0.33% over the last 30 days, indicating a bearish sentiment among analysts [4][10]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for Flowers Foods is lower than the consensus estimate, resulting in an Earnings ESP of -1.06% [10][11]. - The stock currently holds a Zacks Rank of 4, which complicates the prediction of an earnings beat [11]. Historical Performance - In the last reported quarter, Flowers Foods exceeded earnings expectations by delivering $0.22 per share against an expected $0.21, resulting in a surprise of +4.76% [12]. - Over the past four quarters, the company has beaten consensus EPS estimates three times [13]. Conclusion - Despite the potential for an earnings beat, Flowers Foods does not appear to be a strong candidate for exceeding expectations based on current estimates and rankings [16].

Core Viewpoint - Flowers Foods, Inc. is set to report its first quarter 2025 financial results on May 16, 2025, with a live Q&A webcast scheduled for the same day [1]. Group 1: Company Overview - Flowers Foods, Inc. is headquartered in Thomasville, Georgia, and is one of the largest producers of packaged bakery foods in the United States [2]. - The company reported sales of $5.1 billion in 2024 [2]. - Flowers Foods operates bakeries across the country, producing a wide range of bakery products [2]. - Notable brands under Flowers Foods include Nature's Own, Dave's Killer Bread, Canyon Bakehouse, Simple Mills, Wonder, and Tastykake [2].

Core Insights - Dave's Killer Bread is launching organic Sandwich Rolls in two varieties: 21 Whole Grains and Seeds and Sandwich Rolls Done Right, aiming to enhance the sandwich experience for consumers [1][2][3] Product Details - The new Sandwich Rolls are designed for various uses, including sub sandwiches, hot dogs, and French bread pizzas, emphasizing convenience and versatility [2] - The 21 Whole Grains and Seeds variety contains 16g of whole grains and 11g of protein (11% Daily Value) per serving, while the Sandwich Rolls Done Right offers 10g of whole grains and 11g of protein (11% Daily Value) [3] Brand Positioning - Dave's Killer Bread is recognized as America's 1 organic bread brand, with a commitment to high-quality, organic ingredients, and is certified USDA organic and Non-GMO Project Verified [4][5] - The brand is also focused on social responsibility, employing individuals with criminal backgrounds, with one in three employee-partners at its Oregon bakery having such a background [5]

Company Overview - Flowers Foods, Inc. (FLO) is a producer and seller of bakery food products in the United States, with a portfolio that includes brands such as Nature's Own, Dave's Killer Bread, Canyon Bakehouse, and Wonder [1]. Investment Philosophy - The investment philosophy focuses on identifying mispriced securities by understanding the drivers behind a company's financials, often revealed through a DCF model valuation. This approach allows for a flexible investment strategy that encompasses various stock prospects to assess risk-to-reward [1].

Company Overview - Wonder Bread, founded in 1921, is an iconic brand known for popularizing sliced bread and remains a staple in American households [4] - The brand is part of Flowers Foods, Inc., which reported sales of $5.1 billion in 2024 and is one of the largest producers of packaged bakery foods in the U.S. [5] Product Launch - Wonder has launched its first line of snack cakes, expanding its product offerings beyond bread [1][2] - The new line includes a variety of treats designed for lunchboxes and sweet cravings, such as Crème-Filled Chocolate Cupcakes, Glazed Honey Buns, and Powdered Mini Donuts [6] Marketing and Branding - The new treats feature fresh packaging that maintains the brand's classic identity while appealing to modern consumers [3] - The brand aims to evoke nostalgia and joy, similar to the feelings associated with Wonder bread, by introducing these new products [2]

Core Insights - Flowers Foods, Inc. has completed the acquisition of Simple Mills, enhancing its position in the healthier snack market and addressing the rising demand for better-for-you alternatives [1][3][11] Company Overview - Simple Mills, founded in 2012, has become a prominent brand in the natural food sector, offering premium snacks with a focus on clean ingredients and taste, distributed in over 30,000 stores [2] - The acquisition allows Flowers Foods to diversify its product categories and strengthen its presence in the snacking segment [3][4] Strategic Initiatives - Flowers Foods aims to broaden distribution, accelerate innovation, and enhance brand awareness post-acquisition, which is expected to drive growth and profitability [3][11] - The company is actively pursuing acquisitions to expand its brand portfolio and geographic reach, with past acquisitions including Papa Pita Bakery and Dave's Killer Bread [4] Market Positioning - The company is shifting towards premium products, investing in gluten-free, organic, and keto-friendly options to align with evolving consumer dietary trends [5] - Flowers Foods is implementing pricing and cost-saving initiatives while focusing on phasing out low-margin businesses to enhance overall business efficiency [6] Challenges and Performance - Despite strategic efforts, Flowers Foods faces challenges in sustaining growth due to competitive pressures and inflation, impacting its fourth-quarter performance [7] - The company's stock has declined by 14.7% over the past three months, underperforming compared to the industry and the S&P 500 [8]