Avery Dennison Corp

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AVY : NYSE : Consumer Goods
$88.05 up 0.5 | 0.57%
Today's Range: 87.46 - 88.15
Avg. Daily Volume: 625000.0
06/23/17 - 4:02 PM ET

Financial Analysis


AVERY DENNISON CORP's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. AVERY DENNISON CORP has weak liquidity. Currently, the Quick Ratio is 0.80 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.78% 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 FY17 Q1 FY16
Net Sales ($mil)1572.11485.5
EBITDA ($mil)187.9173.4
EBIT ($mil)159.1144.4
Net Income ($mil)112.289.6


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)312.8191.1
Total Assets ($mil)4765.94249.4
Total Debt ($mil)1583.41228.2
Equity ($mil)1014.6968.3


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin29.9730.4
EBITDA Margin11.9511.67
Operating Margin10.129.72
Sales Turnover1.31.39
Return on Assets7.26.87
Return on Equity33.8330.16
Debt Q1 FY17 Q1 FY16
Current Ratio1.241.18
Debt/Capital0.610.56
Interest Expense16.715.8
Interest Coverage9.539.14


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)88.7289.28
Div / share0.410.37
EPS1.250.98
Book value / share11.4410.85
Institutional Own % n/a n/a
Avg Daily Volume620440.0720122.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 28.82 for the Containers & Packaging industry and a discount compared to the S&P 500 average of 25.75. Conducting a second comparison, its price-to-book ratio of 7.66 indicates a significant premium versus the S&P 500 average of 3.09 and a premium versus the industry average of 6.16. The current price-to-sales ratio is well below the S&P 500 average, but above the industry average.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
AVY 23.04 Peers 28.82   AVY 12.74 Peers 15.59

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.

 

Discount. 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 discount 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 17.41 Peers 19.00   AVY 0.77 Peers 0.99

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 discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
AVY 7.66 Peers 6.16   AVY 19.87 Peers 39.18

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

AVY is trading at a premium to its peers.

 

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

However, AVY is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
AVY 1.26 Peers 1.21   AVY 4.19 Peers 4.50

Average. 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 valuation on par with its industry on this measurement.

 

Average. Comparing a company's sales growth to its industry helps to determine if the company is adding or losing market share.

AVY is keeping pace with its peers on the basis of sales growth.

 

 

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