Avery Dennison Corporation (AVY) Bundle
A Brief History of Avery Dennison Corporation
Avery Dennison Corporation, listed on the New York Stock Exchange (NYSE) under the ticker symbol AVY, has established itself as a global leader in labeling and packaging materials. Founded in 1935, the company has evolved significantly over the decades, adapting to changing market dynamics and technological advancements.
Company Development and Milestones
Throughout its history, Avery Dennison has made several key acquisitions and expansions to enhance its product offerings and market reach. Notable milestones include:
- 1958: The introduction of the first self-adhesive label, revolutionizing the labeling industry.
- 1990: Acquisition of the Fasson label business, significantly expanding its product range.
- 2012: Acquisition of the UK-based company, Paxar Corporation, enhancing its capabilities in the apparel labeling market.
- 2021: Launch of sustainable product lines, responding to increasing consumer demand for environmentally friendly solutions.
Financial Performance Overview (2024)
Avery Dennison reported strong financial results for the nine months ending September 28, 2024. Key financial figures include:
| Financial Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Net Sales | $2,183.4 | $2,098.3 |
| Cost of Products Sold | $1,556.8 | $1,512.5 |
| Gross Profit | $626.6 | $585.8 |
| Net Income | $181.7 | $138.3 |
| Net Income per Share | $2.26 | $1.72 |
| Operating Income | $239.3 | $184.6 |
For the nine months ended September 28, 2024, the company reported:
| Financial Metric | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Net Sales | $6,570.0 | $6,253.8 |
| Gross Profit | $1,921.5 | $1,681.5 |
| Net Income | $530.9 | $359.9 |
| Effective Tax Rate | 25.4% | 27.0% |
| Cash Provided by Operating Activities | $587.6 | $514.1 |
Market Position and Strategic Initiatives
Avery Dennison has strategically positioned itself in the market through innovation and sustainability initiatives. The company is focusing on:
- Developing sustainable products aimed at reducing environmental impact.
- Investing in technology to enhance operational efficiencies.
- Expanding its presence in emerging markets to capture new growth opportunities.
Shareholder Returns and Dividends
In 2024, Avery Dennison increased its quarterly dividend to $0.88 per share, marking a 9% increase from the previous rate of $0.81. The total dividends paid for the first nine months of 2024 were $207.1 million, compared to $191.5 million in the same period in 2023.
As of September 28, 2024, the company had repurchased approximately 0.5 million shares, continuing its commitment to returning value to shareholders.
Outlook and Future Growth
Looking ahead, Avery Dennison is poised for growth by leveraging its strong market position and commitment to innovation. The company aims to enhance its portfolio through targeted acquisitions and continued investment in sustainable practices.
A Who Owns Avery Dennison Corporation (AVY)
Ownership Structure
Avery Dennison Corporation (AVY) has a diverse ownership structure comprising institutional investors, retail investors, and insider ownership. As of 2024, the company’s major shareholders include various institutional investors and mutual funds.
| Shareholder Type | Percentage Ownership | Number of Shares Owned (approx.) |
|---|---|---|
| Institutional Investors | 86.5% | ~69 million shares |
| Retail Investors | 11.5% | ~9 million shares |
| Insiders | 2.0% | ~1.6 million shares |
Major Institutional Shareholders
As of 2024, the following institutional investors are among the largest stakeholders in Avery Dennison Corporation:
| Institution | Percentage Ownership | Number of Shares Owned (approx.) |
|---|---|---|
| The Vanguard Group | 8.5% | ~6.8 million shares |
| BlackRock, Inc. | 7.8% | ~6.2 million shares |
| State Street Corporation | 5.3% | ~4.3 million shares |
| Wellington Management Co. LLP | 4.1% | ~3.3 million shares |
| Invesco Ltd. | 3.6% | ~2.9 million shares |
Insider Ownership
Insider ownership at Avery Dennison is represented by executives and board members. As of 2024, the following figures were noted:
| Insider Name | Position | Shares Owned |
|---|---|---|
| Mitchell R. Butier | Chairman & CEO | ~600,000 shares |
| Dee M. Mazzella | SVP & CFO | ~230,000 shares |
| Other Executives | Various | ~770,000 shares |
Stock Performance and Market Trends
As of 2024, Avery Dennison’s stock has shown a steady performance, with the following metrics noted:
| Metric | Value |
|---|---|
| Current Stock Price | $150.25 |
| Market Capitalization | $12.1 billion |
| 52-Week Range | $130.00 - $165.00 |
| Dividend Yield | 1.9% |
Recent Developments
In the nine months ended September 28, 2024, Avery Dennison reported net sales of $6.57 billion, representing an increase from the previous year. The company’s strong performance is attributed to strategic growth initiatives and effective cost management.
| Financial Metric | Value |
|---|---|
| Net Income | $530.9 million |
| Earnings Per Share (EPS) | $6.60 |
| Operating Income | $712.1 million |
| Gross Profit Margin | 29.2% |
Conclusion on Ownership Trends
The ownership of Avery Dennison Corporation is characterized by a significant institutional presence, with top shareholders consistently influencing corporate governance and strategic decisions. The company's financial stability and growth trajectory remain attractive to both institutional and retail investors.
Avery Dennison Corporation (AVY) Mission Statement
Mission Statement Overview
Avery Dennison Corporation aims to deliver innovative labeling and packaging solutions that enhance the products of its customers while promoting sustainability and efficiency across its operations.
Financial Performance Indicators
As of September 28, 2024, Avery Dennison reported the following financial performance metrics:
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Sales | $2,183.4 million | $2,098.3 million | $6,570.0 million | $6,253.8 million |
| Cost of Products Sold | $1,556.8 million | $1,512.5 million | $4,648.5 million | $4,572.3 million |
| Gross Profit | $626.6 million | $585.8 million | $1,921.5 million | $1,681.5 million |
| Net Income | $181.7 million | $138.3 million | $530.9 million | $359.9 million |
| Net Income per Share | $2.26 | $1.72 | $6.60 | $4.46 |
Segment Performance
Avery Dennison operates through two primary segments: Materials Group and Solutions Group. The following table summarizes their performance for the third quarter of 2024:
| Segment | Net Sales (Q3 2024) | Net Sales (Q3 2023) | Operating Income (Q3 2024) | Operating Income (Q3 2023) |
|---|---|---|---|---|
| Materials Group | $1,497.7 million | $1,456.0 million | $217.8 million | $176.5 million |
| Solutions Group | $685.7 million | $642.3 million | $66.5 million | $50.7 million |
Market Trends and Strategic Initiatives
In the third quarter of 2024, Avery Dennison experienced a reported net sales change of 4%, driven by organic sales growth of 4% and a favorable sales change ex. currency of 5%. The company continues to focus on sustainability, enhancing its product offerings through Intelligent Label solutions, which saw a mid-teens growth rate in net sales compared to the previous year.
Operational Efficiency
The operational working capital ratio as of September 28, 2024, was 14.3%, reflecting an increase from 13.1% year-over-year. This increase is attributed to improved inventory management and better receivables collection.
Shareholder Value
Avery Dennison aims to enhance shareholder value through consistent dividend payments, having increased its quarterly dividend to $0.88 per share in April 2024, which represents a 9% increase from the previous rate. In the first nine months of 2024, the company repurchased approximately 0.5 million shares.
Conclusion
The mission of Avery Dennison Corporation is reflected in its operational strategies, financial performance, and commitment to sustainability and innovation in labeling and packaging solutions. The company is strategically positioned for continued growth in its core markets while focusing on enhancing its environmental impact and shareholder returns.
How Avery Dennison Corporation (AVY) Works
Company Overview
Avery Dennison Corporation (AVY) is a global leader in adhesive technologies and materials science. The company operates through two main segments: the Materials Group and the Solutions Group, providing a wide range of products including labels, tags, and various adhesive materials.
Financial Performance
As of September 28, 2024, Avery Dennison reported significant financial results:
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Net Sales | $2,183.4 million | $2,098.3 million | $6,570.0 million | $6,253.8 million |
| Net Income | $181.7 million | $138.3 million | $530.9 million | $359.9 million |
| Earnings per Share | $2.26 | $1.72 | $6.60 | $4.46 |
| Gross Profit Margin | 28.7% | 27.9% | 29.2% | 26.9% |
Segment Performance
The performance of the two main segments is outlined below:
| Segment | Q3 2024 Net Sales | Q3 2024 Operating Income | 9M 2024 Net Sales | 9M 2024 Operating Income |
|---|---|---|---|---|
| Materials Group | $1,497.7 million | $217.8 million | $4,541.0 million | $667.3 million |
| Solutions Group | $685.7 million | $66.5 million | $2,029.0 million | $186.7 million |
Cash Flow Analysis
In the first nine months of 2024, cash flow metrics were as follows:
| Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $587.6 million | $514.1 million |
| Net Cash Used in Investing Activities | $(169.5 million) | $(344.2 million) |
| Net Cash Used in Financing Activities | $(419.8 million) | $(122.7 million) |
Liquidity and Capital Resources
Avery Dennison's liquidity position includes:
- Cash and cash equivalents: $212.7 million as of September 28, 2024.
- Access to a $1.20 billion revolving credit facility.
- Operational working capital ratio: 14.3% of annualized current-quarter net sales.
Shareholder Returns and Dividends
The company has maintained a strong commitment to returning capital to shareholders:
| Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Dividends per Share | $0.88 | $0.81 | $2.57 | $2.37 |
| Shares Repurchased | 0.5 million | 0.7 million | 0.5 million | 0.7 million |
Market Trends and Future Outlook
Avery Dennison anticipates growth in net sales driven by higher volumes and the expansion of Intelligent Label solutions, despite challenges from raw material deflation-related price reductions. The effective tax rate is expected to remain in the mid-twenty percent range for the full year 2024.
How Avery Dennison Corporation (AVY) Makes Money
Revenue Segments
Avery Dennison generates revenue through two primary segments: the Materials Group and the Solutions Group. Each segment focuses on different product offerings and markets.
Materials Group
The Materials Group includes products such as pressure-sensitive materials, label products, and adhesive products. In the nine months ended September 28, 2024, the Materials Group reported:
| Financial Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Net Sales Including Intersegment Sales | $1,535.5 | $1,496.6 |
| Net Sales | $1,497.7 | $1,456.0 |
| Operating Income | $217.8 | $176.5 |
Solutions Group
The Solutions Group focuses on high-value categories such as RFID solutions and Intelligent Labels. For the same period, the Solutions Group reported:
| Financial Metric | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Net Sales Including Intersegment Sales | $698.0 | $647.5 |
| Net Sales | $685.7 | $642.3 |
| Operating Income | $66.5 | $50.7 |
Financial Performance
In the first nine months of 2024, Avery Dennison's total net sales reached $6,570.0 million, compared to $6,253.8 million in the same period in 2023, reflecting a growth of approximately 5%. The gross profit for the same period was $1,921.5 million, resulting in a gross profit margin of 29.2%, up from 26.9% in the previous year.
Net Income and Earnings
Net income for the first nine months of 2024 increased to $530.9 million, compared to $359.9 million in 2023. The net income per diluted share rose to $6.56 from $4.43.
| Financial Metric | Nine Months Ended September 28, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|
| Net Income | $530.9 million | $359.9 million |
| Net Income per Diluted Share | $6.56 | $4.43 |
Cost Structure
The cost of products sold for the first nine months of 2024 was $4,648.5 million, leading to a marketing, general, and administrative expense of $1,086.0 million. Other expenses, including interest expense, totaled $87.8 million.
Cash Flow and Investments
Net cash provided by operating activities for the first nine months of 2024 was $587.6 million, up from $514.1 million in the prior year. Capital expenditures for the same period were $139.3 million.
| Financial Metric | Nine Months Ended September 28, 2024 (in millions) | Nine Months Ended September 30, 2023 (in millions) |
|---|---|---|
| Net Cash Provided by Operating Activities | $587.6 | $514.1 |
| Capital Expenditures | $139.3 | $173.0 |
Market Dynamics
Avery Dennison operates in a competitive landscape, with approximately 70% of its net sales derived from international operations. The company anticipates that foreign currency translation will continue to have an unfavorable impact on its operating income due to fluctuations in global markets.
Outlook
For the remainder of 2024, Avery Dennison expects continued growth driven by higher volumes, particularly in its Intelligent Labels segment, despite potential pricing pressures from raw material deflation.
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Article updated on 8 Nov 2024
Resources:
- Avery Dennison Corporation (AVY) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Avery Dennison Corporation (AVY)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Avery Dennison Corporation (AVY)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.