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Avery Dennison Corp
AVY : NYSE : Consumer Goods
$61.96 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 764,900
05/21/15 - 4:03 PM ET

Financial Analysis


AVERY DENNISON CORP's gross profit margin for the first quarter of its fiscal year 2015 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. AVERY DENNISON CORP has weak liquidity. Currently, the Quick Ratio is 0.75 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 31.37% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY15 Q1 FY14
Net Sales ($mil)1528.01550.1
EBITDA ($mil)162.3150.7
EBIT ($mil)129.1110.5
Net Income ($mil)71.671.2


Balance Sheet Q1 FY15 Q1 FY14
Cash & Equiv. ($mil)213.3222.5
Total Assets ($mil)4312.64591.3
Total Debt ($mil)1211.01118.3
Equity ($mil)1026.01495.0


Profitability Q1 FY15 Q1 FY14
Gross Profit Margin30.3128.86
EBITDA Margin10.629.72
Operating Margin8.457.13
Sales Turnover1.461.35
Return on Assets5.784.99
Return on Equity24.4716.66
Debt Q1 FY15 Q1 FY14
Current Ratio1.221.35
Debt/Capital0.540.43
Interest Expense15.816.5
Interest Coverage8.176.7


Share Data Q1 FY15 Q1 FY14
Shares outstanding (mil)90.8395.74
Div / share0.350.29
EPS0.770.73
Book value / share11.315.62
Institutional Own % n/a n/a
Avg Daily Volume727797.0880939.0

Valuation


BUY. The current P/E ratio indicates a discount compared to an average of 28.06 for the Containers & Packaging industry and a premium compared to the S&P 500 average of 20.73. Conducting a second comparison, its price-to-book ratio of 5.36 indicates a significant premium versus the S&P 500 average of 2.86 and a premium versus the industry average of 5.27. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount. The valuation analysis reveals that, AVERY DENNISON CORP seems to be trading at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AVY 22.75 Peers 28.06   AVY 11.30 Peers 10.29

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

AVY is trading at a discount to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

AVY is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
AVY 15.92 Peers 19.33   AVY 0.81 Peers 1.21

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

AVY is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

AVY trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AVY 5.36 Peers 5.27   AVY 6.40 Peers -2.35

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

AVY is trading at a valuation on par with its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

AVY is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AVY 0.87 Peers 1.07   AVY 1.88 Peers 3.42

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

AVY is trading at a discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

AVY significantly trails its peers on the basis of sales growth

 

 

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