For those looking to find strong Industrial Products stocks, it is prudent to search for companies in the group that are outperforming their peers. Is Avery Dennison (AVY) one of those stocks right now? Let's take a closer look at the stock's year-to-date performance to find out.Avery Dennison is a member of our Industrial Products group, which includes 222 different companies and currently sits at #4 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Ran ...

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A month has gone by since the last earnings report for Avery Dennison (AVY) . Shares have added about 4.6% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Avery Dennison due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Avery Dennison Q1 Earnings Beat, Revenues Rise Y ...

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Avery Dennison (AVY) reported $2.15 billion in revenue for the quarter ended March 2024, representing a year-over-year increase of 4.2%. EPS of $2.29 for the same period compares to $1.70 a year ago.The reported revenue represents a surprise of +0.16% over the Zacks Consensus Estimate of $2.15 billion. With the consensus EPS estimate being $2.15, the EPS surprise was +6.51%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street ...

Financial Data and Key Metrics Changes - Adjusted earnings per share for Q1 2024 was $2.29, up 6% sequentially and up 35% compared to the prior year, driven by higher volume and productivity [13] - Sales increased by 4% excluding currency effects and 3% on an organic basis compared to the prior year, with adjusted EBITDA margin at 16.3%, up 270 basis points year-over-year [13] - Free cash flow was strong at $58 million, an increase of $129 million compared to the prior year, with a net debt to adjusted EBITDA ratio of 2.3% [14] Business Line Data and Key Metrics Changes - Materials Group sales were up 2% excluding currency and on an organic basis, driven by low-double digit volume growth, while Solutions Group sales increased by 10% excluding currency and 6% on an organic basis [15][17] - Intelligent Labels grew mid-to-high teens in Q1, with strong growth in non-apparel categories, while apparel began to recover [10][17] - The Materials Group achieved an adjusted EBITDA margin of 18.3%, up 4 points year-over-year, while Solutions Group's adjusted EBITDA margin was 16.1%, up 40 basis points compared to the prior year [16][17] Market Data and Key Metrics Changes - North America volume was up mid-single digits year-over-year, with Europe showing significant growth of more than 30% as destocking cycles ended [15] - Emerging markets, particularly India and ASEAN, showed strong volume growth, with China up mid-single digits [7][15] - Apparel imports in North America showed slight improvement, although retailers remain cautious in their near-term sourcing plans [8][30] Company Strategy and Development Direction - The company aims for approximately 20% growth in its Intelligent Labels platform in 2024, focusing on expanding its leadership position at the intersection of physical and digital [10][11] - The company is committed to investing in organic growth and acquisitions while returning cash to shareholders, with $81 million returned in Q1 through share repurchases and dividends [14] - The company maintains a disciplined capital allocation strategy and is focused on balancing top-line growth with margin sustainability [36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying fundamentals of the business, citing diverse and growing markets with clear catalysts for long-term growth [11] - The company reaffirmed its full-year guidance for strong earnings growth in 2024, despite uncertainties in the operating environment [12][18] - Management noted that while apparel industry volumes are expected to normalize mid-year, there remains caution in the market [30][66] Other Important Information - The company anticipates modest inflation in raw material costs in Q2, particularly in paper, and is addressing these through product reengineering and pricing actions [16][42] - The company has deepened and broadened its supply chain to mitigate risks from potential future strikes and supply chain disruptions [64] Q&A Session Summary Question: Insights on Intelligent Labels guidance and margin expectations - Management noted lower-than-expected volumes in logistics due to slower parcel shipments but remains confident in the growth potential of Intelligent Labels, particularly in apparel [22][23] - Solutions margins were expected to decrease sequentially due to seasonality and higher employee costs, but management anticipates improvement in Q2 [25][26] Question: Apparel market normalization and pricing impact - Management highlighted slight improvements in apparel imports and inventory levels, supporting confidence in normalization by mid-2024 [29][30] - Pricing impact in Q1 was down mid-to-high single digits year-over-year, with expectations for sequential pricing increases in Q2 [31][32] Question: Sustainability of Materials Group margins - Management indicated that volume increases and productivity initiatives are driving margin expansion, with a focus on balancing growth and capital efficiency [35][36] Question: Handling rising paper costs and inflation - Management expects it to take about a quarter to implement pricing adjustments in response to inflation, with visibility on materials markets remaining limited [41][42] Question: Internal indicators and market normalization - Management confirmed that the materials business is returning to normal, with destocking behind them, and apparel is also heading in the right direction [67][68]

Avery Dennison Corporation (AVY) has delivered adjusted earnings of $2.29 per share in first-quarter 2024, surpassing the Zacks Consensus Estimate of $2.15. The bottom line marked a 35% year-over-year improvement, driven by higher volume and productivity gains.Including one-time items, the company reported earnings per share (EPS) of $2.13 compared with the year-ago quarter’s $1.49 per share.Total revenues increased 4.2% year over year to $2.15 billion, surpassing the Zacks Consensus Estimate of $2.14 billi ...

Avery Dennison (AVY) reported $2.15 billion in revenue for the quarter ended March 2024, representing a year-over-year increase of 4.2%. EPS of $2.29 for the same period compares to $1.70 a year ago.The reported revenue represents a surprise of +0.16% over the Zacks Consensus Estimate of $2.15 billion. With the consensus EPS estimate being $2.15, the EPS surprise was +6.51%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street ...

Avery Dennison (AVY) came out with quarterly earnings of $2.29 per share, beating the Zacks Consensus Estimate of $2.15 per share. This compares to earnings of $1.70 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 6.51%. A quarter ago, it was expected that this maker of office products would post earnings of $2.15 per share when it actually produced earnings of $2.16, delivering a surprise of 0.47%.Over the last four quarters, ...

[First Quarter 2024 Results](index=1&type=section&id=First%20Quarter%202024%20Results) Avery Dennison reported strong first-quarter results with significant growth in sales and earnings, leading to a maintained full-year adjusted EPS guidance [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Avery Dennison reported strong first-quarter results with significant year-over-year growth in earnings per share and net sales, driven by volume and productivity gains Q1 2024 Key Financial Metrics | Metric | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | | Reported EPS | $2.13 | +43% | | Adjusted EPS (non-GAAP) | $2.29 | +35% | | Net Sales | $2.2 billion | +4% | | Sales Change ex. currency (non-GAAP) | +4% | N/A | | Organic Sales Change (non-GAAP) | +3% | N/A | - CEO Deon Stander attributed the strong earnings growth to higher volume and productivity gains[2](index=2&type=chunk) - The Materials Group experienced significant volume growth as downstream inventory destocking subsided, while the Solutions Group saw strong growth in high-value categories[3](index=3&type=chunk) - The company is targeting another year of significant growth in Intelligent Labels in 2024, expecting the apparel industry to normalize and accelerate solution adoption[3](index=3&type=chunk) [Full-Year 2024 Guidance](index=3&type=section&id=Guidance) The company slightly revised its full-year 2024 reported EPS guidance downward while maintaining its adjusted EPS forecast FY2024 Earnings Per Share Guidance | Metric | Previous Guidance | Revised/Current Guidance | | :--- | :--- | :--- | | Reported EPS | $8.65 to $9.15 | $8.60 to $9.10 | | Adjusted EPS (non-GAAP) | $9.00 to $9.50 | $9.00 to $9.50 (unchanged) | - The guidance for adjusted EPS excludes an estimated **$0.40 per share** impact from restructuring charges and other items[9](index=9&type=chunk) [Segment Performance](index=2&type=section&id=First%20Quarter%202024%20Results%20by%20Segment) Segment performance showed growth in both Materials and Solutions groups, driven by volume and high-value categories respectively [Materials Group](index=2&type=section&id=Materials%20Group) The Materials Group reported increased sales and significant margin expansion, driven by volume growth as destocking subsided Materials Group Q1 2024 Performance | Metric | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | | Reported Sales | $1.5 billion | +2% | | Organic Sales | N/A | +2% | | Reported Operating Margin | 15.1% | +410 bps | | Adjusted EBITDA Margin (non-GAAP) | 18.3% | +410 bps | - Label Materials sales were up mid-single digits on an organic basis, with volume/mix up low-double digits, partially offset by deflation-related price reductions[5](index=5&type=chunk) - Graphics and Reflectives, and Performance Tapes and Medical were down mid-single digits organically[5](index=5&type=chunk) [Solutions Group](index=2&type=section&id=Solutions%20Group) The Solutions Group achieved strong sales growth, particularly in high-value categories, with improved adjusted EBITDA margin Solutions Group Q1 2024 Performance | Metric | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | | Reported Sales | $655 million | +8% | | Organic Sales | N/A | +6% | | Reported Operating Margin | 8.6% | +10 bps | | Adjusted EBITDA Margin (non-GAAP) | 16.1% | +40 bps | - Sales in high-value categories were up low double-digits organically, while base solutions were up low-single digits organically[6](index=6&type=chunk) - The company continues to anticipate the apparel industry will normalize in mid-2024[6](index=6&type=chunk) - Margin was down sequentially due to seasonality and the add-back of 2023 temporary cost reductions; sequential margin improvement is expected in Q2[6](index=6&type=chunk) [Other Financial Information](index=3&type=section&id=Other%20Financial%20Information) The company maintained a strong balance sheet, returned capital to shareholders, and realized savings from restructuring efforts [Balance Sheet and Capital Deployment](index=3&type=section&id=Balance%20Sheet%20and%20Capital%20Deployment) Avery Dennison returned **$81 million** to shareholders in Q1 2024 while maintaining a strong balance sheet with a **2.3x** net debt ratio - Returned **$81 million** in cash to shareholders in Q1 2024, consisting of **$65.3 million** in dividends and **$16 million** in share repurchases (**0.1 million** shares)[7](index=7&type=chunk)[25](index=25&type=chunk) - The company's balance sheet remains strong, with a Net debt to adjusted EBITDA (non-GAAP) ratio of **2.3x** at the end of Q1[7](index=7&type=chunk)[42](index=42&type=chunk) [Income Taxes and Cost Reduction Actions](index=3&type=section&id=Income%20Taxes%20and%20Cost%20Reduction%20Actions) The company reported an effective tax rate of **26.5%** and realized **$19 million** in pre-tax savings from restructuring actions - The reported effective tax rate was **26.5%** in Q1, while the adjusted tax rate (non-GAAP) was **26.0%**[7](index=7&type=chunk) - The company realized approximately **$19 million** in pre-tax savings from restructuring in Q1, while incurring about **$6 million** in pre-tax restructuring charges[8](index=8&type=chunk) [Financial Statements (Unaudited)](index=7&type=section&id=Financial%20Statements) The unaudited financial statements show increased net sales and income, a stable balance sheet, and improved operating cash flow [Consolidated Statements of Income](index=7&type=section&id=PRELIMINARY%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME) The consolidated statements of income show increased net sales and a significant rise in net income for Q1 2024 Q1 Statement of Income Highlights (in millions, except per share) | Account | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net sales | $2,151.3 | $2,065.0 | | Gross profit | $632.2 | $542.3 | | Income before taxes | $234.4 | $168.3 | | Net income | $172.4 | $121.2 | | Net income per share, diluted | $2.13 | $1.49 | [Consolidated Balance Sheets](index=8&type=section&id=PRELIMINARY%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The balance sheets indicate stable total assets and increased shareholders' equity as of March 30, 2024 Balance Sheet Highlights (in millions) | Account | Mar 30, 2024 | Apr 1, 2023 | | :--- | :--- | :--- | | Total current assets | $2,886.8 | $2,989.2 | | Total assets | $8,255.2 | $8,222.3 | | Total current liabilities | $3,308.2 | $2,643.7 | | Total long-term debt | $2,069.9 | $2,910.8 | | Total shareholders' equity | $2,204.0 | $2,042.9 | [Consolidated Statements of Cash Flows](index=9&type=section&id=PRELIMINARY%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Operating cash flow significantly improved in Q1 2024, offsetting cash used in investing and financing activities Q1 Cash Flow Highlights (in millions) | Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $119.8 | $1.9 | | Net cash used in investing activities | ($62.0) | ($116.6) | | Net cash (used in) provided by financing activities | ($85.0) | $299.8 | | Decrease in cash and cash equivalents | ($29.3) | $184.1 | [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures%20from%20GAAP) The company provides non-GAAP financial measures to offer a clearer view of core operating performance and facilitate comparisons [Explanation of Non-GAAP Measures](index=10&type=section&id=Explanation%20of%20Non-GAAP%20Measures) The company utilizes non-GAAP financial measures to provide a clearer understanding of underlying performance trends by excluding specific items - Non-GAAP measures are used internally to evaluate underlying performance and facilitate competitor comparisons[27](index=27&type=chunk) - Key non-GAAP measures include: Sales change ex. currency, Organic sales change, Adjusted operating income/margin, Adjusted EBITDA/margin, Adjusted net income, Adjusted EPS, Net debt to adjusted EBITDA ratio, and Adjusted free cash flow[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) - These measures exclude items such as restructuring charges, certain legal outcomes, strategic transaction costs, and currency adjustments for highly inflationary economies to provide a clearer view of core operating results[28](index=28&type=chunk) [Reconciliation Tables](index=11&type=section&id=Reconciliation%20Tables) Reconciliation tables detail adjustments from GAAP to non-GAAP figures, showing higher adjusted net income and positive adjusted free cash flow Q1 2024 GAAP to Non-GAAP Net Income Reconciliation (in millions) | Description | Amount | | :--- | :--- | | As reported net income (GAAP) | $172.4 | | Adjustments (Restructuring, other items) | $19.3 | | Argentine interest income | ($3.6) | | Tax effect and impact of adjusted tax rate | ($3.0) | | **Adjusted net income (non-GAAP)** | **$185.1** | Q1 2024 GAAP to Non-GAAP EPS Reconciliation | Description | Amount | | :--- | :--- | | As reported net income per common share (GAAP) | $2.13 | | Adjustments per share, net of tax | $0.16 | | **Adjusted net income per common share (non-GAAP)** | **$2.29** | Q1 Adjusted Free Cash Flow Reconciliation (in millions) | Description | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $119.8 | $1.9 | | Less: Purchases of PP&E, software, etc. | ($55.7) | ($69.8) | | Other adjustments (Argentine Swap, asset sales) | ($6.0) | ($3.3) | | **Adjusted free cash flow (non-GAAP)** | **$58.1** | **($71.2)** | [Company Information](index=3&type=section&id=Company%20Information) This section provides an overview of Avery Dennison's business and outlines key risk factors and forward-looking statement disclaimers [About Avery Dennison](index=3&type=section&id=About%20Avery%20Dennison) Avery Dennison is a global materials science and digital identification solutions company serving diverse industries worldwide - The company is a global materials science and digital identification solutions provider, offering products like labeling materials, RFID inlays, and software[11](index=11&type=chunk) - Serves a wide range of industries including home and personal care, apparel, e-commerce, logistics, food, pharmaceuticals, and automotive[12](index=12&type=chunk) - Employs approximately **35,000** people in over **50** countries, with reported sales of **$8.4 billion** in 2023[12](index=12&type=chunk) ["Safe Harbor" Statement and Risk Factors](index=4&type=section&id=Safe%20Harbor%20Statement) The document contains forward-looking statements subject to various risks, including global economic conditions and raw material costs - The release contains forward-looking statements that are not guarantees of future performance and are subject to risks[13](index=13&type=chunk) - Key near-term risk factors include: global economic conditions, competitor actions, raw material costs, ability to pass on price increases, currency fluctuations, and acquisition integration[14](index=14&type=chunk) - Other risks include international operations (e.g., China, geopolitical conflicts), demand fluctuations, IT disruptions, tax law changes, and human capital retention[14](index=14&type=chunk)