Avery Dennison Corporation AVY has delivered third-quarter 2024 adjusted earnings of $2.33 per share , which beating the Zacks Consensus Estimate of $2.32. The bottom line increased 9% year over year, driven by higher volume and productivity gains.

Including one-time items, the company reported earnings per share (EPS) of $2.25 compared with the year-ago quarter’s $1.71.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Avery Dennison’s Revenues & Margins Improve Y/Y in Q3

Total revenues grew 4.1% year over year to $2.18 billion and missed the Zacks Consensus Estimate of $2.2 billion.

Avery Dennison Corporation Price, Consensus and EPS Surprise

Avery Dennison Corporation price-consensus-eps-surprise-chart | Avery Dennison Corporation Quote

The cost of sales grew 2.9% year over year to $1.56 billion. The gross profit improved 7% year over year to $627 million.

Marketing, general and administrative expenses were $347 million compared with the $325 million in the year-ago quarter. The adjusted operating profit was around $280 million compared with the prior-year quarter’s $261 million. The adjusted operating margin was 12.8% compared with the year-ago quarter’s 12.4%.

AVY’s Segments Deliver Y/Y Growth in Revenues & Profit

Revenues in the Materials Group segment increased 3% year over year to around $1.5 billion . The reported figure came in line with our estimate. On an organic basis, sales rose 3.6%. We predicted organic sales to rise 3.7%. 

The segment’s adjusted operating profit grew 3% year over year to $222 million. Our estimate was  $230 million.

Revenues in the Solutions Group were up 7% year over year to $686 million. We estimated revenues of $680 million for this segment. On an organic basis, sales grew 6%. Our model predicted 5.8% growth. 

The segment’s adjusted operating income increased 26% year over year to $77 million. Our estimate was $71 million.

Avery Dennison’s Cash & Debt Position

The company returned $315 million in cash to shareholders through share repurchases and dividend payments in the first nine-month period of 2024. AVY repurchased 0.5 million shares throughout the period.

Avery Dennison ended the quarter with cash and cash equivalents of $213 million compared with $210 million at the end of the year-ago quarter. The company’s long-term debt was $2.04 billion at the end of the quarter, down from $2.6 billion at the end of the third quarter of 2023.

AVY Revised Guidance for 2024

The company expects reported sales growth to be in the range of 5.0-5.5% (previously 4.5-5.5%). This includes a 0.5% contribution from acquisitions. Organic sales growth is envisioned in the band of 4.5-5.0%. AVY had previously provided a range of 4.0-5.0%.

Avery Dennison now projects full-year adjusted EPS to be in the range of $9.35-$9.50 compared with the prior stated 9.30-$9.50. The mid point of the guidance projects 19% growth from adjusted EPS of $7.90 in 2023.

Avery Dennison Stock’s Price Performance

AVY’s shares have gained 25% in the past year compared with the industry’s 17.1% growth.

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Office Supplies Stocks Awaiting Results

Xerox Holdings Corporation XRX is scheduled to release its third-quarter results on Oct. 29. The Zacks Consensus Estimate for XRX’s earnings is pegged at 53 cents per share, indicating year-over-year growth of 15.2%.

The consensus estimate for the company’s top line is pegged at $1.60 billion, indicating a decline of 3.4% from the prior-year figure. XRX has a trailing four-quarter average surprise of a negative 25.4%.

ACCO Brands Corporation ACCO is expected to release its third-quarter 2024 results on Oct. 31. The Zacks Consensus Estimate for ACCO Brands’ earnings is pegged at 23 cents per share, indicating a year-over-year fall of 4%.

The consensus estimate for the company’s top line is pegged at $418 million, implying a decrease of 6.7% from the prior-year figure. ACCO has a trailing four-quarter average surprise of 22.97%.

AVY’s Zacks Rank & a Stock to Consider

Avery Dennison currently carries a Zacks Rank #3 (Hold).

A better-ranked stock from the Industrial Products sector is Parker-Hannifin Corporation PH. It currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Parker-Hannifin’s fiscal 2025 earnings is pegged at $26.68 per share. The company has a trailing four-quarter average earnings surprise of 11.2%. PH’s shares have gained 76.4% in a year.

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