August 24, 2023
Top 10 Stock Flowers Foods Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Flowers Foods – Top 10 Stock in S&P Food & Beverage Index
Flowers Foods is listed as a top 10 stock on August 24, 2023 in the market index S&P US Food & Beverage because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 47 (47% performer), Obermatt assesses an overall hold recommendation for Flowers Foods on August 24, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Packaged Foods & Meats |
| Index | Dividends USA, S&P US Food & Beverage, S&P MIDCAP |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Flowers Foods Hold
| 360 METRICS | August 24, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 73 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 17 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 60 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 39 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 47 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 47 (better than 47% compared with alternatives), overall professional sentiment and financial characteristics for the stock Flowers Foods are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Flowers Foods. The consolidated Value Rank has an attractive rank of 73, which means that the share price of Flowers Foods is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 73% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 60. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 39. Professional investors are more confident in 61% other stocks. The consolidated Growth Rank also has a low rank of 17, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 83 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 47, Flowers Foods is worse than 53% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 73), and the financing structure is on the safer side (Safety Rank of 60). However, sentiment in the professional investor community is below-average (Sentiment Rank of 39), as is the growth momentum for the company (Growth Rank of 17). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Flowers Foods only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 39 (better than 39% compared with alternatives), overall professional sentiment and engagement for the stock Flowers Foods is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Flowers Foods. Analyst Opinions are at a rank of 23 (worse than 77% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 95, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Flowers Foods. More encouragingly, the Professional Investors rank is 52, which means that professional investors hold more stock in this company than in 52% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 20, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 80% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 39 (less encouraging than 61% compared with investment alternatives), Flowers Foods has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Flowers Foods. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Flowers Foods Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 73 (better than 73% compared with alternatives), Flowers Foods shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Flowers Foods. Price-to-Sales (P/S) is 64, which means that the stock price compared with what market professionals expect for future sales is lower than for 64% of comparable companies, indicating a good value concerning Flowers Foods's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 52% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 90 (dividends are expected to be higher than 90% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 63% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Flowers Foods to 37. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 73, is a buy recommendation based on Flowers Foods's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Flowers Foods Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 17 (better than 17% compared with alternatives), Flowers Foods shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for Flowers Foods. Sales Growth has a rank of 45, which means that currently professionals expect the company to grow less than 55% of its competitors. The same is valid for Profit Growth, with a rank of 20, and Capital Growth with 40. In addition, Stock Returns have a below market rank of 43, which means that the stock returns have recently been below 57% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 17, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: Flowers Foods Debt Financing Safety above-average
| SAFETY METRICS | August 24, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 52 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 30 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 71 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 60 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 60 (better than 60% compared with alternatives), the company Flowers Foods has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Flowers Foods is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Flowers Foods. Leverage is at a rank of 52, meaning the company has a below-average debt-to-equity ratio. It has less debt than 52% of its competitors. Liquidity is also good at a rank of 71, meaning the company generates more profit to service its debt than 71% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 30, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 70% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 60 (better than 60% compared with alternatives), Flowers Foods has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Flowers Foods. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Flowers Foods Below-Average Financial Performance
| COMBINED PERFORMANCE | August 24, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 73 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 17 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 71 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 49 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 49 (worse than 51% compared with investment alternatives), Flowers Foods (Packaged Foods & Meats, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Flowers Foods are a good value (attractively priced) with a consolidated Value Rank of 73 (better than 73% of alternatives), are safely financed (Safety Rank of 60, which means low debt burdens), but show below-average growth (Growth Rank of 17). ...read more
RECOMMENDATION: A Combined Rank of 49, is a hold recommendation based on Flowers Foods's financial characteristics. As the company Flowers Foods's key financial metrics exhibit good value (Obermatt Value Rank of 73) but low growth (Obermatt Growth Rank of 17) while being safely financed (Obermatt Safety Rank of 60), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 73% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.