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AVY

Avery Dennison NYSE:AVY Stock Report

Last Price

US$162.70

Market Cap

US$13.2b

7D

-1.8%

1Y

-22.4%

Updated

02 Oct, 2022

Data

Company Financials +
AVY fundamental analysis
Snowflake Score
Valuation4/6
Future Growth2/6
Past Performance2/6
Financial Health2/6
Dividends5/6

AVY Stock Overview

Avery Dennison Corporation manufactures and markets pressure-sensitive materials and products in the United States, Europe, Asia, Latin America, and internationally.

Avery Dennison Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Avery Dennison
Historical stock prices
Current Share PriceUS$162.70
52 Week HighUS$229.24
52 Week LowUS$151.62
Beta0.98
1 Month Change-12.28%
3 Month Change-1.06%
1 Year Change-22.39%
3 Year Change46.10%
5 Year Change62.15%
Change since IPO897.40%

Recent News & Updates

Sep 12
Here's Why Avery Dennison (NYSE:AVY) Can Manage Its Debt Responsibly

Here's Why Avery Dennison (NYSE:AVY) Can Manage Its Debt Responsibly

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility...

Aug 29

Avery Dennison: The Easy Money Has Been Made, But Further Upside Potential Exists

Summary Avery Dennison has done well to increase its sales and profits over the past couple of quarters. Management also now has a more favorable view of the 2022 fiscal year, but it's also true that the easy money has been made. Upside from here is more limited, but it is still enough to warrant investor consideration. One of the more niche companies I have come across recently has been Avery Dennison (AVY). This producer of pressure-sensitive materials, such as papers, plastic films, metal foils, and fabrics, that are then sold to label printers and converters for the purpose of label production and other related products, also offers the benefit of quality fundamentals and attractive growth. Of course, the picture has not always been this way. Prior to the pandemic, some of the company's fundamental figures were volatile and it was only in 2021 that we began seeing some really nice growth for the enterprise. But fast forward to today, and that growth continues while shares are trading at levels that are not unrealistic. I would argue, of course, that much of the easy money in the company has already been made. But so long as its fundamental health remains robust, I do think there might be some additional upside on the table for investors to benefit from. This is despite the fact that similar companies are trading at levels that are much cheaper by comparison. Strength persists Back in March of this year, I wrote an article about Avery Dennison that took a bullish stance on the firm. I called the company a unique player that was slightly underpriced. I based this assessment not just on the company's share price from a valuation perspective but also on the fact that the company had been exhibiting attractive growth since the pandemic came to an end. At the end of the day, I rated the business a ‘buy’, indicating my belief that it did offer some upside potential for investors relative to the broader market. Since then, the company has performed quite well. At a time when the S&P 500 is down by 3.5%, investors in Avery Dennison would have generated a return of 15.2%. Author - SEC EDGAR Data This increase in price was not because of random market fluctuations alone. I would argue that it was largely driven by continued strength demonstrated by the company. When I last wrote about the firm, we only had data covering through the 2021 fiscal year for the business. Today, we now have data covering the first half of 2022. So far, those numbers are quite robust. For the first half of the year as a whole, revenue came in at just under $4.70 billion. This represents an increase of 13.1% over the $4.15 billion the company generated the same time one year earlier. Author - SEC EDGAR Data This growth in sales was driven by strength across the board. However, the greatest upside on a percentage basis came from its Retail Branding and Information Solutions operations. Revenue here jumped by 32.1% from $1.01 billion to $1.34 billion. It is worth noting, however, that actual organic growth from this set of operations was a more modest but still respectable 12%. The company benefited from its acquisition of Vestcom as well. Given current market conditions, it is fair to put particular scrutiny on the most recent quarter since said uncertainty could result in the picture changing rather rapidly. But what data we do have in this regard is also encouraging. During the second quarter alone, sales came in at $2.35 billion. That's 11.7% above the $2.10 billion generated the second quarter of 2021. With this increase in sales, we have also seen a nice increase in profitability. Consider, as an example, net income. For the first half of the year, net income came in at $412.7 million. That's 4.9% higher than the $393.3 million generated in the first half of 2021. A fair argument is that profitability is not climbing at the same rate that revenue is, therefore implying margin contraction. However, this picture is a little more complicated than that. Yes, for the first half of the year as a whole, margins did decrease, with the company's cost of products sold climbing from 71.8% of revenue to 72.6%. This may not seem like much of a change, but the impact when applied to last year's revenue translates to $67.3 million in additional pre-tax cash flow missing from the business. Management attributed this pain to the net impact of pricing, freight, and raw material costs, as well as to higher employee-related expenses. It was, of course, offset to some degree by greater volume and favorable product mix. Despite this pain, the picture did improve in the second quarter itself, as evidenced by the fact that the cost of products sold, relative to revenue, remained flat in that quarter compared to the same quarter last year. Strong volume and product mix in the second quarter perfectly offset higher pricing, freight, and raw material costs, as well as the aforementioned employee-related expenses. We should also pay attention, of course, to other profitability metrics. Operating cash flow is interesting because, unlike earnings, it actually worsened year over year, following from $476.8 million in the first half of 2021 to $394.4 million the same time this year. If we adjust for changes in working capital, however, it would have risen nicely from $563.7 million to $629.3 million. And over that same window of time, EBITDA for the company also improved, rising from $663.6 million to $742.3 million. Just as was the case with earnings, which shot up by 16.7% from $183.8 million in the second quarter of last year to $214.5 million the same time this year, the real improvement and the other profitability metrics also occurred in the second quarter. Operating cash flow inched up from $267.5 million to $268.2 million. On an adjusted basis, this figure rose from $276.4 million to $323.5 million. Meanwhile, EBITDA for the company shot up from $213.8 million to $384 million. Thanks to the improvements in the second quarter of the year, management now has a more favorable outlook regarding profitability for 2022 as a whole. Previously, the company anticipated earnings per share of between $9.35 and $9.75. This has now been revised up to between $9.60 and $9.90. It's also worth noting that these estimates include a $0.10 per share restructuring charge that should prove to be one-time in nature. Adding that restructuring charge back into the equation, the company should generate net income of $808.7 million for the year. That should translate to a 9.3% increase over the $740.1 million generated in 2021. No guidance was given when it came to other profitability metrics. But if we assume that they will increase at the same rate that earnings should, then we should anticipate adjusted operating cash flow of nearly $1.20 billion and EBITDA of $1.46 billion.

Aug 25
Avery Dennison (NYSE:AVY) Has Announced That It Will Be Increasing Its Dividend To $0.75

Avery Dennison (NYSE:AVY) Has Announced That It Will Be Increasing Its Dividend To $0.75

The board of Avery Dennison Corporation ( NYSE:AVY ) has announced that it will be paying its dividend of $0.75 on the...

Shareholder Returns

AVYUS PackagingUS Market
7D-1.8%-2.1%-2.5%
1Y-22.4%-27.2%-23.2%

Return vs Industry: AVY exceeded the US Packaging industry which returned -27.2% over the past year.

Return vs Market: AVY matched the US Market which returned -23.2% over the past year.

Price Volatility

Is AVY's price volatile compared to industry and market?
AVY volatility
AVY Average Weekly Movement4.2%
Packaging Industry Average Movement5.1%
Market Average Movement6.8%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.8%

Stable Share Price: AVY is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: AVY's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
193535,780Mitch Butierhttps://www.averydennison.com

Avery Dennison Corporation manufactures and markets pressure-sensitive materials and products in the United States, Europe, Asia, Latin America, and internationally. The company’s Label and Graphic Materials segment offers pressure-sensitive label and packaging materials under the Fasson, JAC, and Avery Dennison brands; graphics products under the Avery Dennison and Mactac brands; and reflective products under the Avery Dennison brand. This segment provides its products to the home and personal care, beer and beverage, durables, pharmaceutical, wine and spirits, and food market segments; architectural, commercial sign, digital printing, and other related market segments; construction, automotive, and fleet transportation market segments; traffic and safety applications; and sign shops, commercial printers, and designers.

Avery Dennison Fundamentals Summary

How do Avery Dennison's earnings and revenue compare to its market cap?
AVY fundamental statistics
Market CapUS$13.22b
Earnings (TTM)US$759.50m
Revenue (TTM)US$8.95b

17.4x

P/E Ratio

1.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
AVY income statement (TTM)
RevenueUS$8.95b
Cost of RevenueUS$6.53b
Gross ProfitUS$2.42b
Other ExpensesUS$1.66b
EarningsUS$759.50m

Last Reported Earnings

Jul 02, 2022

Next Earnings Date

n/a

Earnings per share (EPS)9.35
Gross Margin27.08%
Net Profit Margin8.48%
Debt/Equity Ratio166.9%

How did AVY perform over the long term?

See historical performance and comparison

Dividends

1.8%

Current Dividend Yield

30%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is AVY undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for AVY?

Other financial metrics that can be useful for relative valuation.

AVY key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue1.8x
Enterprise Value/EBITDA12.1x
PEG Ratio2.1x

Price to Earnings Ratio vs Peers

How does AVY's PE Ratio compare to its peers?

AVY PE Ratio vs Peers
The above table shows the PE ratio for AVY vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average11.7x
AMCR Amcor
19.8x8.0%US$15.9b
PKG Packaging Corporation of America
10.3x1.0%US$10.5b
IP International Paper
8.1x-0.08%US$11.5b
WRK WestRock
8.5x20.2%US$7.9b
AVY Avery Dennison
17.4x8.2%US$13.2b

Price-To-Earnings vs Peers: AVY is expensive based on its Price-To-Earnings Ratio (17.4x) compared to the peer average (11.7x).


Price to Earnings Ratio vs Industry

How does AVY's PE Ratio compare vs other companies in the North American Packaging Industry?

Price-To-Earnings vs Industry: AVY is expensive based on its Price-To-Earnings Ratio (17.4x) compared to the North American Packaging industry average (12.6x)


Price to Earnings Ratio vs Fair Ratio

What is AVY's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

AVY PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio17.4x
Fair PE Ratio18.4x

Price-To-Earnings vs Fair Ratio: AVY is good value based on its Price-To-Earnings Ratio (17.4x) compared to the estimated Fair Price-To-Earnings Ratio (18.4x).


Share Price vs Fair Value

What is the Fair Price of AVY when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: AVY ($162.7) is trading below our estimate of fair value ($431.24)

Significantly Below Fair Value: AVY is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is Avery Dennison forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


8.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AVY's forecast earnings growth (8.2% per year) is above the savings rate (1.9%).

Earnings vs Market: AVY's earnings (8.2% per year) are forecast to grow slower than the US market (14.8% per year).

High Growth Earnings: AVY's earnings are forecast to grow, but not significantly.

Revenue vs Market: AVY's revenue (4.3% per year) is forecast to grow slower than the US market (7.7% per year).

High Growth Revenue: AVY's revenue (4.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AVY's Return on Equity is forecast to be high in 3 years time (33.9%)


Discover growth companies

Past Performance

How has Avery Dennison performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


22.2%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: AVY has high quality earnings.

Growing Profit Margin: AVY's current net profit margins (8.5%) are lower than last year (9.3%).


Past Earnings Growth Analysis

Earnings Trend: AVY's earnings have grown significantly by 22.2% per year over the past 5 years.

Accelerating Growth: AVY's earnings growth over the past year (3.5%) is below its 5-year average (22.2% per year).

Earnings vs Industry: AVY earnings growth over the past year (3.5%) underperformed the Packaging industry 12.1%.


Return on Equity

High ROE: Whilst AVY's Return on Equity (39.21%) is high, this metric is skewed due to their high level of debt.


Discover strong past performing companies

Financial Health

How is Avery Dennison's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: AVY's short term assets ($2.9B) do not cover its short term liabilities ($3.0B).

Long Term Liabilities: AVY's short term assets ($2.9B) do not cover its long term liabilities ($3.2B).


Debt to Equity History and Analysis

Debt Level: AVY's net debt to equity ratio (156.7%) is considered high.

Reducing Debt: AVY's debt to equity ratio has increased from 156.6% to 166.9% over the past 5 years.

Debt Coverage: AVY's debt is well covered by operating cash flow (29.8%).

Interest Coverage: AVY's interest payments on its debt are well covered by EBIT (13.9x coverage).


Balance Sheet


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Dividend

What is Avery Dennison current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


1.84%

Current Dividend Yield

Dividend Yield vs Market

Avery Dennison Dividend Yield vs Market
How does Avery Dennison dividend yield compare to the market?
SegmentDividend Yield
Company (Avery Dennison)1.8%
Market Bottom 25% (US)1.7%
Market Top 25% (US)4.7%
Industry Average (Packaging)3.1%
Analyst forecast in 3 Years (Avery Dennison)1.9%

Notable Dividend: AVY's dividend (1.84%) is higher than the bottom 25% of dividend payers in the US market (1.67%).

High Dividend: AVY's dividend (1.84%) is low compared to the top 25% of dividend payers in the US market (4.73%).


Stability and Growth of Payments

Stable Dividend: AVY's dividends per share have been stable in the past 10 years.

Growing Dividend: AVY's dividend payments have increased over the past 10 years.


Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (30.3%), AVY's dividend payments are well covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (36.6%), AVY's dividend payments are well covered by cash flows.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

5.1yrs

Average management tenure


CEO

Mitch Butier (51 yo)

6.5yrs

Tenure

US$12,433,721

Compensation

Mr. Mitchell R. Butier, also known as Mitch, has been the Chief Executive Officer of Avery Dennison Corporation since May 1, 2016 and was as its President since November 1, 2014 until March 1, 2022 and has...


CEO Compensation Analysis

Mitch Butier's Compensation vs Avery Dennison Earnings
How has Mitch Butier's remuneration changed compared to Avery Dennison's earnings?
DateTotal Comp.SalaryCompany Earnings
Jul 02 2022n/an/a

US$760m

Apr 02 2022n/an/a

US$729m

Jan 01 2022US$12mUS$1m

US$740m

Oct 02 2021n/an/a

US$749m

Jul 03 2021n/an/a

US$735m

Apr 03 2021n/an/a

US$631m

Jan 02 2021US$9mUS$1m

US$556m

Sep 26 2020n/an/a

US$527m

Jun 27 2020n/an/a

US$521m

Mar 28 2020n/an/a

US$585m

Dec 28 2019US$8mUS$1m

US$304m

Sep 28 2019n/an/a

US$238m

Jun 29 2019n/an/a

US$243m

Mar 30 2019n/an/a

US$195m

Dec 29 2018US$9mUS$1m

US$467m

Sep 29 2018n/an/a

US$311m

Jun 30 2018n/an/a

US$270m

Mar 31 2018n/an/a

US$295m

Dec 30 2017US$9mUS$1m

US$282m

Sep 30 2017n/an/a

US$403m

Jul 01 2017n/an/a

US$384m

Apr 01 2017n/an/a

US$343m

Dec 31 2016US$10mUS$988k

US$321m

Oct 01 2016n/an/a

US$315m

Jul 02 2016n/an/a

US$307m

Apr 02 2016n/an/a

US$292m

Jan 02 2016US$7mUS$761k

US$274m

Compensation vs Market: Mitch's total compensation ($USD12.43M) is about average for companies of similar size in the US market ($USD13.04M).

Compensation vs Earnings: Mitch's compensation has increased by more than 20% in the past year.


Leadership Team

Experienced Management: AVY's management team is seasoned and experienced (5.1 years average tenure).


Board Members

Experienced Board: AVY's board of directors are seasoned and experienced ( 11.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: AVY insiders have only sold shares in the past 3 months.


Recent Insider Transactions

NYSE:AVY Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
14 Sep 22SellUS$500,699Anthony AndersonIndividual2,800US$178.82
29 Oct 21SellUS$303,800Deena Baker-NelIndividual1,400US$217.00

Ownership Breakdown

What is the ownership structure of AVY?
Owner TypeNumber of SharesOwnership Percentage
State or Government42,4320.05%
Individual Insiders590,7260.7%
General Public6,010,2167.4%
Institutions74,613,03391.8%

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Top 25 shareholders own 59.68% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
11.97%
The Vanguard Group, Inc.
9,729,543$1.6b0.57%0.04%
7.87%
T. Rowe Price Group, Inc.
6,398,230$1.0b7.34%0.13%
7.84%
BlackRock, Inc.
6,367,477$1.0b-5.91%0.03%
4.66%
State Street Global Advisors, Inc.
3,790,305$616.7m-2.05%0.04%
2.76%
Victory Capital Management Inc.
2,242,414$364.8m3.5%0.41%
2.36%
Lazard Asset Management LLC
1,918,645$312.2m9.76%0.32%
2.02%
Columbia Management Investment Advisers, LLC
1,640,915$267.0m17.18%0.08%
1.99%
Neuberger Berman Investment Advisers LLC
1,620,757$263.7m40.57%0.27%
1.94%
Geode Capital Management, LLC
1,579,747$257.0m-0.19%0.03%
1.82%
Fiduciary Management, Inc.
1,475,661$240.1m299.63%1.96%
1.4%
J.P. Morgan Asset Management, Inc.
1,139,276$185.4m17.72%0.04%
1.19%
Invesco Ltd.
967,705$157.4m-2.27%0.05%
1.18%
Lord, Abbett & Co. LLC
962,078$156.5m-18.79%0.57%
1.04%
The Public Investment Fund of The Kingdom of Saudi Arabia
848,657$138.1m0%0.05%
1.01%
Northern Trust Global Investments
818,339$133.1m-3.94%0.03%
1%
BNY Mellon Asset Management
814,688$132.5m-0.61%0.03%
0.96%
FMR LLC
781,373$127.1m1.02%0.01%
0.95%
Millennium Management LLC
770,258$125.3m114.42%0.17%
0.9%
Norges Bank Investment Management
730,788$118.9m0%0.02%
0.89%
Dimensional Fund Advisors LP
719,421$117.0m-1.27%0.03%
0.86%
Veritas Investment Management LLP
697,964$113.6m17.4%3.2%
0.83%
Homestead Advisers Corp.
677,958$110.3m-4.7%3.27%
0.75%
Charles Schwab Investment Management, Inc.
611,651$99.5m0.71%0.03%
0.74%
Legal & General Investment Management Limited
599,458$97.5m-5.81%0.03%
0.72%
Invesco Capital Management LLC
588,659$95.8m-5.25%0.08%

Company Information

Avery Dennison Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Avery Dennison Corporation
  • Ticker: AVY
  • Exchange: NYSE
  • Founded: 1935
  • Industry: Paper Packaging
  • Sector: Materials
  • Implied Market Cap: US$13.220b
  • Shares outstanding: 81.26m
  • Website: https://www.averydennison.com

Number of Employees


Location

  • Avery Dennison Corporation
  • 8080 Norton Parkway
  • Mentor
  • Ohio
  • 44060
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AVYNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
AV3DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
0HJRLSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
AVYBASE (Buenos Aires Stock Exchange)CEDEAR EACH 3 REP 1 ORD USD1ARARSDec 2000
AVYDBASE (Buenos Aires Stock Exchange)CEDEAR EACH 3 REP 1 ORD USD1ARUSDDec 2000
A1VY34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 COMBRBRLJan 2020

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/10/02 00:00
End of Day Share Price2022/09/30 00:00
Earnings2022/07/02
Annual Earnings2022/01/01


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.