We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Factors to Note as Flowers Foods (FLO) Lines Up for Q1 Earnings
Read MoreHide Full Article
Flowers Foods, Inc. (FLO - Free Report) is likely to witness year-over-year growth in its top line when it reports first-quarter fiscal 2022 earnings on May 19. The Zacks Consensus Estimate for revenues is pegged at $1,405 million, suggesting a rise of 7.9% from the prior-year quarter’s reported figure.
The Zacks Consensus Estimate for earnings has remained unchanged over the past 30 days at 38 cents per share. This indicates a decrease of 7.3% from the figure reported in the prior-year period. Flowers Foods has a trailing four-quarter earnings surprise of 9%, on average. This packaged bakery products company delivered a negative earnings surprise of 9.1% in the last reported quarter.
Flowers Foods, Inc. Price, Consensus and EPS Surprise
Flowers Foods is seeing elevated costs, which weighed on its adjusted EBITDA margin in the fourth quarter of fiscal 2021. In the last reported quarter, the gross margin as a percentage of sales, excluding depreciation and amortization, contracted by 110 basis points (bps) to 47.9% due to unfavorable sales and increased ingredient and packaging costs. FLO’s materials, labor, supplies and other production expenses (excluding depreciation and amortization) as a percentage of sales escalated by 110 bps to 52.1% in the fiscal fourth quarter. This was a result of reduced sales and elevated ingredient and packaging costs, somewhat negated by lower outside purchases and reduced incentive compensation costs.
Management stated that it expects inflation to be meaningfully higher in 2022. The company expects high-single-digit cost increases for the year. Management highlighted that the price of commodities like flour, fats and oils and packaging has shot up significantly. That said, the company has been focused on undertaking pricing actions to counter commodity cost inflation.
Another factor aiding Flowers Foods’ performance is strength in non-retail and other sales, which rose 3.5% to $216.8 million in the fourth quarter of fiscal 2021. Although non-retail and other sales remain below pre-pandemic levels, it is seeing continued recovery with stronger margins. Apart from this, the company’s focus on its core priorities bodes well. These priorities include developing its team, concentrating on brands, prioritizing margins and looking out for prudent mergers and acquisitions.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Flowers Foods this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Flowers Foods currently has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Costco Wholesale (COST - Free Report) currently has an Earnings ESP of +1.90% and a Zacks Rank of 2. The company is likely to register an increase in the top line when it reports third-quarter fiscal 2022 numbers. The consensus mark for Costco's quarterly earnings has moved up by a penny in the past seven days to $3.04 per share. The consensus estimate suggests 10.6% growth from the year-ago quarter’s reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
Costco's top line is expected to rise year over year. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $51.8 billion, which suggests a rise of 14.3% from the figure reported in the prior-year quarter.
Ross Stores (ROST - Free Report) currently has an Earnings ESP of +1.24% and a Zacks Rank of 2. The company is likely to register an increase in the top line when it reports first-quarter fiscal 2022 results. The consensus mark for Ross Stores’ quarterly revenues is pegged at $4.5 billion, which suggests a rise of 0.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for ROST’s earnings has been unchanged at 99 cents per share in the past 30 days. However, the consensus estimate indicates a 26.1% decline from the $1.34 reported in the year-ago quarter.
Designer Brands (DBI - Free Report) currently has an Earnings ESP of +4.35% and a Zacks Rank of 3. The company is likely to register top and bottom-line growth when it reports first-quarter fiscal 2022 earnings. The consensus mark for Designer Brands’ quarterly revenues is pegged at $806.7 million, which suggests 14.7% growth from the figure reported in the prior-year quarter.
The consensus mark for quarterly earnings has moved up by a penny in the past 30 days to 23 cents per share. The consensus estimate for DBI suggests growth of 91.7% from the year-ago quarter.
Image: Bigstock
Factors to Note as Flowers Foods (FLO) Lines Up for Q1 Earnings
Flowers Foods, Inc. (FLO - Free Report) is likely to witness year-over-year growth in its top line when it reports first-quarter fiscal 2022 earnings on May 19. The Zacks Consensus Estimate for revenues is pegged at $1,405 million, suggesting a rise of 7.9% from the prior-year quarter’s reported figure.
The Zacks Consensus Estimate for earnings has remained unchanged over the past 30 days at 38 cents per share. This indicates a decrease of 7.3% from the figure reported in the prior-year period. Flowers Foods has a trailing four-quarter earnings surprise of 9%, on average. This packaged bakery products company delivered a negative earnings surprise of 9.1% in the last reported quarter.
Flowers Foods, Inc. Price, Consensus and EPS Surprise
Flowers Foods, Inc. price-consensus-eps-surprise-chart | Flowers Foods, Inc. Quote
Key Factors to Consider
Flowers Foods is seeing elevated costs, which weighed on its adjusted EBITDA margin in the fourth quarter of fiscal 2021. In the last reported quarter, the gross margin as a percentage of sales, excluding depreciation and amortization, contracted by 110 basis points (bps) to 47.9% due to unfavorable sales and increased ingredient and packaging costs. FLO’s materials, labor, supplies and other production expenses (excluding depreciation and amortization) as a percentage of sales escalated by 110 bps to 52.1% in the fiscal fourth quarter. This was a result of reduced sales and elevated ingredient and packaging costs, somewhat negated by lower outside purchases and reduced incentive compensation costs.
Management stated that it expects inflation to be meaningfully higher in 2022. The company expects high-single-digit cost increases for the year. Management highlighted that the price of commodities like flour, fats and oils and packaging has shot up significantly. That said, the company has been focused on undertaking pricing actions to counter commodity cost inflation.
Another factor aiding Flowers Foods’ performance is strength in non-retail and other sales, which rose 3.5% to $216.8 million in the fourth quarter of fiscal 2021. Although non-retail and other sales remain below pre-pandemic levels, it is seeing continued recovery with stronger margins. Apart from this, the company’s focus on its core priorities bodes well. These priorities include developing its team, concentrating on brands, prioritizing margins and looking out for prudent mergers and acquisitions.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Flowers Foods this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Flowers Foods currently has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Costco Wholesale (COST - Free Report) currently has an Earnings ESP of +1.90% and a Zacks Rank of 2. The company is likely to register an increase in the top line when it reports third-quarter fiscal 2022 numbers. The consensus mark for Costco's quarterly earnings has moved up by a penny in the past seven days to $3.04 per share. The consensus estimate suggests 10.6% growth from the year-ago quarter’s reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.
Costco's top line is expected to rise year over year. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $51.8 billion, which suggests a rise of 14.3% from the figure reported in the prior-year quarter.
Ross Stores (ROST - Free Report) currently has an Earnings ESP of +1.24% and a Zacks Rank of 2. The company is likely to register an increase in the top line when it reports first-quarter fiscal 2022 results. The consensus mark for Ross Stores’ quarterly revenues is pegged at $4.5 billion, which suggests a rise of 0.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for ROST’s earnings has been unchanged at 99 cents per share in the past 30 days. However, the consensus estimate indicates a 26.1% decline from the $1.34 reported in the year-ago quarter.
Designer Brands (DBI - Free Report) currently has an Earnings ESP of +4.35% and a Zacks Rank of 3. The company is likely to register top and bottom-line growth when it reports first-quarter fiscal 2022 earnings. The consensus mark for Designer Brands’ quarterly revenues is pegged at $806.7 million, which suggests 14.7% growth from the figure reported in the prior-year quarter.
The consensus mark for quarterly earnings has moved up by a penny in the past 30 days to 23 cents per share. The consensus estimate for DBI suggests growth of 91.7% from the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.