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Avery Dennison Corp AVY

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Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Higher Volumes, Favorable Currency Moves Drive Avery Dennison's Remarkable 1Q Sales Growth

Charles Gross Equity Analyst

Analyst Note

| Charles Gross |

Avery Dennison posted a robust first quarter amid early signs of an economic rebound in parts of the world. Organic sales rose nearly 9% versus the prior year, to $2.05 billion. The strong start to 2021, combined with favorable currency translation, has led management to significantly raise its adjusted EPS expectations to $8.60 versus $7.85. The new target looks achievable, assuming North America, Europe, and Asia continue their economic recovery. We have raised our fair value to $107 per share from $98 due to a weaker dollar and a brighter near-term outlook for Avery. Our no-moat rating is unchanged.

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Company Profile

Business Description

Avery Dennison manufactures pressure-sensitive materials, merchandise tags, and labels. The company also runs a specialty converting business that produces radio-frequency identification inlays and labels. Avery Dennison draws a significant amount of revenue from outside the United States, with international operations accounting for the majority of total sales.

Contact
207 Goode Avenue
Glendale, CA, 91203
T +1 626 304-2000
Sector Industrials
Industry Business Equipment & Supplies
Most Recent Earnings Mar 31, 2021
Fiscal Year End Jan 2, 2022
Stock Type Cyclical
Employees 32,000

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