Avery Dennison (AVY): Assessing Valuation After a Steady Month and 8% Share Price Gain

It has been a steady month for Avery Dennison (AVY), despite recent fluctuations in its share price. The stock has shown an 8% gain over the past month. Investors appear to be weighing up its long-term growth prospects amid changing market conditions.

See our latest analysis for Avery Dennison.

Momentum around Avery Dennison has picked up after a strong 1-month share price return of 8%, even as its year-to-date performance stays in the red and the 12-month total shareholder return remains negative. The latest moves suggest investors are reassessing the company’s long-term outlook as market sentiment fluctuates.

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With shares still trading below analyst price targets and recent financial growth outpacing the broader market, the key question for investors is whether Avery Dennison is presenting an attractive entry point or if optimism is already fully reflected in its valuation.

Most Popular Narrative: 14.6% Undervalued

Avery Dennison’s most widely followed narrative values shares at $202.36, compared to the most recent close of $172.91. The setup is that analysts see revenue acceleration and robust execution as factors putting long-term upside on the table. Here’s one key driver in their words:

The accelerating global adoption of smart labels, RFID, and traceable technologies, seen in robust growth in food and logistics (mid-teens growth) and ongoing program rollouts (e.g., Kroger and new pilots), positions Avery Dennison for sustained revenue expansion as more end-markets digitize their supply chains and inventory management.

Read the complete narrative.

What’s powering the bold price target? There is a precise set of targets for top-line growth, fatter margins, and a profit multiple that shows real conviction. The methodology behind this valuation hinges on a few crucial forecasts that most investors overlook. Want to see the numbers behind the narrative? The details may surprise you.

Result: Fair Value of $202.36 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks remain, including sustained weakness in apparel demand and growing competition in digital label technologies. Both factors could challenge Avery Dennison's growth narrative.

Find out about the key risks to this Avery Dennison narrative.

Build Your Own Avery Dennison Narrative

If you believe in your own analysis or want an independent take, you can dive in and shape your own Avery Dennison story in just a few minutes. Do it your way

A great starting point for your Avery Dennison research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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