Avery Dennison Q4 Earnings Beat Estimates, Rise Y/Y on Higher Volumes

Core Insights - Avery Dennison Corporation (AVY) reported adjusted earnings of $2.38 per share for Q4 2024, surpassing the Zacks Consensus Estimate of $2.37, marking a 10% year-over-year increase [1][2] - Total revenues for Q4 2024 reached $2.19 billion, a 3.6% increase year-over-year, although it fell short of the Zacks Consensus Estimate of $2.20 billion [3][10] - The company’s adjusted EPS for the full year 2024 was $9.43, exceeding the Zacks Consensus Estimate of $9.41, and represented a 19% year-over-year increase [9] Financial Performance - The cost of sales improved by 4.1% year-over-year to $1.58 billion, while gross profit rose 2.2% to $609 million [3] - Marketing, general and administrative expenses decreased to $329 million from $335 million in the previous year, with adjusted operating profit increasing to approximately $280 million from $261 million [4] - The adjusted operating margin improved to 12.8% compared to 12.4% in the prior-year quarter [4] Segment Performance - Revenues in the Materials Group segment increased by 3.7% year-over-year to $1.47 billion, although it missed the estimate of $1.48 billion [5] - The Solutions Group saw revenues rise by 3.2% year-over-year to $714 million, also falling short of the estimated $735 million [6] - Adjusted operating income for the Materials Group increased by 9.6% to $217.5 million, while the Solutions Group's adjusted operating income grew by 0.9% to $81 million [5][6] Cash and Debt Position - The company returned $525 million to shareholders through share repurchases and dividends in 2024, repurchasing 1.2 million shares [7] - Cash and cash equivalents at the end of 2024 were $329 million, up from $215 million at the end of 2023 [7] - Long-term debt decreased to $2.56 billion from $2.62 billion, with a net debt to adjusted EBITDA ratio of 2.0X [7] Future Guidance - For 2025, Avery Dennison expects adjusted EPS to be between $9.80 and $10.20 [11] Stock Performance - Avery Dennison's shares have declined by 1.7% over the past year, compared to a 6.3% decline in the industry [12]