Flowers Foods, Inc. (FLO): Will This Food Business March Higher After a Solid Run?

In the beginning of 2012, General Mills, Inc. (NYSE:GIS) launched Nature Valley Protein Bars. Right in the first year, it has brought to the company $95.7 million in sales. Information Resources ranked the product as one of the top 10 New Product Pacesetters for 2012. Information Resources commented: “Nature Valley Protein Bars, for instance, offer the delicious taste of nature in a handheld bar packed with 10 grams of protein.”

What I like about General Mills, Inc. (NYSE:GIS) is its uninterrupted dividends for nearly two thirds of the century. Since 2003, it has raised its dividends from $0.55 per share to $1.22 per share. Income investors might also like the fact that General Mills offers decent dividend yield at 3%. Campbell Soup Company (NYSE:CPB) ranked second with a 2.40% dividend yield while the dividend yield of Flowers Foods, Inc. (NYSE:FLO) is the lowest at 1.90%.

My Foolish take

After the significant rise in the stock price, Flowers Foods, Inc. (NYSE:FLO) is not cheap anymore. It has a much higher valuation than the two biggest and strongest companies mentioned above. Even with the EPS and cash flow accretion from Sara Lee, Earthgrains, and Hostess’ brands, the highest valuation and lowest dividend yield restrains me from initiating a long position in Flowers Foods at its current trading price.

The article Will This Food Business March Higher After a Solid Run? originally appeared on Fool.com and is written by Anh Hoang.

Anh HOANG has no position in any stocks mentioned. The Motley Fool recommends Flowers Foods.

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