After the Memorial Day holiday in the United States, the earnings spotlight turns to Canadian banks: Bank of Montreal (NYSE: BMO), Canadian Imperial Bank of Commerce (NYSE: CM), Royal Bank of Canada (NYSE: RY), and Toronto-Dominion Bank (NYSE: TD) are all scheduled to report their second-quarter results.

While banks north of the border of generally have held up better than their U.S. counterparts, analysts surveyed by Thomson Reuters expect the four listed above to report that earnings declined between 20% and 30% since the same period of last year. All four have P/E ratios around 10, and they are paying dividends. Shares of all four have surged 50% to 83% in the past three months, but are still 26% to 38% lower than a year ago.

Flowers Foods (NYSE: FLO) is a leading producer and marketer of packaged bakery foods for retail and foodservice customers. The firm's Bakeries division makes bread, rolls, buns and other bakery items for distribution throughout the southern U.S. Its Specialty division makes snack cakes and frozen bread products for retail and vending customers nationwide. Among the company's top brands are Nature's Own, Cobblestone Mill, Sunbeam, Blue Bird, and Mrs. Freshley's. Clients include Burger King (NYSE: BKC) and Wendy's International (NYSE: WEN).

Flowers Foods surprised the Street late last month, when it reported Q4 EPS of 23 cents and revenues of $473.7 million. Analysts had been expecting 21 cents and $468.8 million. Management also guided FY08 EPS to $1.07-$1.17 ($1.12 consensus) and FY08 revenues to $2.21-$2.258 billion ($2.2B consensus).

As some folks may not realize, most of the food products we see in the grocery store are provided for us by a relatively limited number of firms. On the bakery side, one of the big outfits is an 88-year-old company headquartered in Thomasville, Georgia.

Flowers Foods (NYSE: FLO) is a leading producer and marketer of packaged bakery foods for retail and foodservice customers. The firm's Bakeries division makes bread, rolls, buns and other bakery items for distribution throughout the southern U.S. Its Specialty division makes snack cakes and frozen bread products for retail and vending customers nationwide. Among the company's top brands are Nature's Own, Cobblestone Mill, Sunbeam, Blue Bird and Mrs. Freshley's. Clients include Burger King (NYSE: BKC) and Wendy's International (NYSE: WEN).

Flowers Foods surprised Wall Street earlier in the month, when it reported Q3 EPS of 24 cents and revenues of $475.2 million. Analysts had been expecting 22 cents and $472.2 million. Management also guided FY07 EPS to $0.98-$1.02 (98 cent consensus), FY07 revenues to $2.027-$2.034 billion ($2.03B consensus), FY08 EPS to $1.07-$1.17 ($1.09 consensus) and FY08 revenues to $2.20-$2.258 billion ($2.16B consensus). The FLO share price popped through major moving average resistance on the news and has since been defining a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with five "strong buys," one "buy" and three "holds." The FLO Price to Sales ratio (1.03), Price to Book ratio (3.20), Price to Cash Flow ratio (12.91), Price to Free Cash Flow ratio (20.07) and EPS Growth rate (26.32%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 69% of the outstanding shares. Over the past 52 weeks, the stock has traded between $17.37 and $23.71. A stop-loss of $19.50 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.