AVERY DENNISON CORP (AVY)
US0536111091 - Common Stock
AVY gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 23 industry peers in the Containers & Packaging industry. While AVY belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. While showing a medium growth rate, AVY is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
AVY had positive earnings in the past year.
In the past year AVY had a positive cash flow from operations.
AVY had positive earnings in each of the past 5 years.
In the past 5 years AVY always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.13%, AVY is in the better half of the industry, outperforming 78.26% of the companies in the same industry.
The Return On Equity of AVY (23.64%) is better than 91.30% of its industry peers.
AVY's Return On Invested Capital of 12.96% is amongst the best of the industry. AVY outperforms 95.65% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AVY is significantly above the industry average of 8.25%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.13% | ||
| ROE | 23.64% | ||
| ROIC | 12.96% |
ROA(3y)8.31%
ROA(5y)7.92%
ROE(3y)33.12%
ROE(5y)32.4%
ROIC(3y)14.04%
ROIC(5y)15.14%
1.3 Margins
Looking at the Profit Margin, with a value of 6.01%, AVY is in the better half of the industry, outperforming 69.57% of the companies in the same industry.
AVY's Profit Margin has declined in the last couple of years.
AVY has a better Operating Margin (11.52%) than 78.26% of its industry peers.
AVY's Operating Margin has improved in the last couple of years.
AVY has a better Gross Margin (27.23%) than 78.26% of its industry peers.
AVY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.52% | ||
| PM (TTM) | 6.01% | ||
| GM | 27.23% |
OM growth 3Y-2.35%
OM growth 5Y1.63%
PM growth 3Y-8.98%
PM growth 5Y-1.63%
GM growth 3Y-0.44%
GM growth 5Y0.35%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), AVY is creating some value.
The number of shares outstanding for AVY has been reduced compared to 1 year ago.
Compared to 5 years ago, AVY has less shares outstanding
Compared to 1 year ago, AVY has a worse debt to assets ratio.
2.2 Solvency
AVY has an Altman-Z score of 3.91. This indicates that AVY is financially healthy and has little risk of bankruptcy at the moment.
AVY has a better Altman-Z score (3.91) than 86.96% of its industry peers.
AVY has a debt to FCF ratio of 6.00. This is a neutral value as AVY would need 6.00 years to pay back of all of its debts.
AVY has a better Debt to FCF ratio (6.00) than 69.57% of its industry peers.
AVY has a Debt/Equity ratio of 1.23. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.23, AVY is in line with its industry, outperforming 56.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | 6 | ||
| Altman-Z | 3.91 |
ROIC/WACC1.58
WACC8.2%
2.3 Liquidity
AVY has a Current Ratio of 1.04. This is a normal value and indicates that AVY is financially healthy and should not expect problems in meeting its short term obligations.
AVY has a worse Current ratio (1.04) than 78.26% of its industry peers.
AVY has a Quick Ratio of 1.04. This is a bad value and indicates that AVY is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.69, AVY is not doing good in the industry: 73.91% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.04 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
The earnings per share for AVY have decreased by -8.96% in the last year.
Measured over the past 5 years, AVY shows a small growth in Earnings Per Share. The EPS has been growing by 6.53% on average per year.
Looking at the last year, AVY shows a decrease in Revenue. The Revenue has decreased by -7.47% in the last year.
AVY shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.16% yearly.
EPS 1Y (TTM)-8.96%
EPS 3Y5.42%
EPS 5Y6.53%
EPS growth Q2Q58.18%
Revenue 1Y (TTM)-7.47%
Revenue growth 3Y6.26%
Revenue growth 5Y3.16%
Revenue growth Q2Q4.18%
3.2 Future
Based on estimates for the next years, AVY will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.62% on average per year.
The Revenue is expected to grow by 4.40% on average over the next years.
EPS Next Y13.1%
EPS Next 2Y13.01%
EPS Next 3Y12.89%
EPS Next 5Y9.62%
Revenue Next Year4.79%
Revenue Next 2Y5.1%
Revenue Next 3Y5.29%
Revenue Next 5Y4.4%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 25.50 indicates a quite expensive valuation of AVY.
AVY's Price/Earnings ratio is a bit more expensive when compared to the industry. AVY is more expensive than 69.57% of the companies in the same industry.
AVY is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 25.25, which is the current average of the S&P500 Index.
AVY is valuated rather expensively with a Price/Forward Earnings ratio of 22.55.
73.91% of the companies in the same industry are cheaper than AVY, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.67. AVY is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.5 | ||
| Fwd PE | 22.55 |
4.2 Price Multiples
86.96% of the companies in the same industry are cheaper than AVY, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AVY indicates a rather expensive valuation: AVY more expensive than 82.61% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.62 | ||
| EV/EBITDA | 15.95 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
AVY has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as AVY's earnings are expected to grow with 12.89% in the coming years.
PEG (NY)1.95
PEG (5Y)3.9
EPS Next 2Y13.01%
EPS Next 3Y12.89%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.53%, AVY has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.01, AVY has a dividend in line with its industry peers.
AVY's Dividend Yield is slightly below the S&P500 average, which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
5.2 History
On average, the dividend of AVY grows each year by 16.63%, which is quite nice.
AVY has been paying a dividend for at least 10 years, so it has a reliable track record.
AVY has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)16.63%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
AVY pays out 51.03% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of AVY is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP51.03%
EPS Next 2Y13.01%
EPS Next 3Y12.89%
AVERY DENNISON CORP
NYSE:AVY (4/24/2024, 7:04:00 PM)
After market: 212.42 0 (0%)212.42
+1.09 (+0.52%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap17.10B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.5 | ||
| Fwd PE | 22.55 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.95
PEG (5Y)3.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.13% | ||
| ROE | 23.64% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 11.52% | ||
| PM (TTM) | 6.01% | ||
| GM | 27.23% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.02
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.04 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-8.96%
EPS 3Y5.42%
EPS 5Y
EPS growth Q2Q
EPS Next Y13.1%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-7.47%
Revenue growth 3Y6.26%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y