10 Best Mid-Cap Dividend Aristocrats To Buy

6. Flowers Foods, Inc. (NYSE:FLO)

Number of Hedge Fund Holders: 26

Flowers Foods, Inc. (NYSE:FLO) ranks sixth on our list of the best mid-cap dividend aristocrat stocks. The American company specializes in producing and marketing bakery products. With a strong presence in the Southeast and Southwest, where it holds more than 30% market share, FLO is home to well-known brands like Wonder, Nature’s Own, and Tasty Cake. The company follows a strategy centered on consistent revenue growth and margin expansion, targeting annual EBITDA growth of 4-6% while aiming for sales growth of 1-2%. By focusing on higher-margin product lines, such as organic and gluten-free options, the company is able to boost its earnings potential.

In the third quarter of 2024, Flowers Foods, Inc. (NYSE:FLO) reported revenue of $1.2 billion, down 0.73% from the same period last year. Net income rose by $111.7 million to reach $65.0 million, mainly driven by higher operating income from a reduction in legal settlements and related costs, though this was partly offset by increased net interest expenses. The company significantly outperformed the bread category, with tracked channel sales growing both in units and dollars. These results were achieved despite challenges from a strained consumer environment, which particularly affected its sweet baked goods and fast food businesses.

Flowers Foods, Inc. (NYSE:FLO) also has a strong cash generation. In the first nine months of the year, the company generated $282.4 million in operating cash flow. During this period, the company paid $152.5 million in dividends to shareholders. Moreover, it has raised its payouts for 22 years in a row. The company offers a quarterly dividend of $0.24 per share and has a dividend yield of 4.58%, as of December 16.

Insider Monkey’s database of Q3 2024 indicated that 25 hedge funds held stakes in Flowers Foods, Inc. (NYSE:FLO), compared with 26 in the previous quarter. The overall value of these stakes is over $313.3 million.