Why Is Avery Dennison (AVY) Down 10.9% Since Last Earnings Report?

Core Insights - Avery Dennison reported Q3 2025 adjusted earnings of $2.37 per share, exceeding the Zacks Consensus Estimate of $2.32, with a year-over-year increase of 1.7% driven by productivity gains [2] - Total revenues for Q3 grew 1.5% year over year to $2.22 billion, surpassing the Zacks Consensus Estimate of $2.21 billion [3] - The company returned $670 million to shareholders through share repurchases and dividends in the first nine months of 2025 [7] Financial Performance - The cost of sales increased by 1.5% year over year to $1.58 billion, while gross profit improved by 1.3% to $635 million, maintaining a gross margin of 28.7% [3][4] - Marketing, general, and administrative expenses rose to $354 million from $347 million in the previous year, with adjusted operating profit around $281 million, slightly up from $280 million [4] - The Materials Group segment saw revenues increase by 1.2% to $1.52 billion, although organic sales dipped by 1.9% due to price reductions [5] Segment Performance - Revenues in the Solutions Group increased by 2% year over year to $699.5 million, with organic sales growth of 3.6%, but adjusted operating income decreased by 9.9% to $69.7 million [6] Cash and Debt Position - At the end of the quarter, cash and cash equivalents stood at $536 million, up from $213 million a year ago, while long-term debt rose to $3.20 billion from $2.04 billion [8] Guidance and Outlook - The company anticipates adjusted EPS for Q4 2025 to be between $2.35 and $2.45 [9] - Following the earnings release, there has been a downward trend in estimates, indicating a potential shift in investor sentiment [10][13]