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Avery Dennison (AVY) Earnings and Sales Top Estimates in Q3
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Avery Dennison Corporation (AVY - Free Report) reported adjusted earnings of $1.66 per share in third-quarter 2019, which surpassed the Zacks Consensus Estimate of $1.60. The figure also increased around 14% year over year.
Including one-time items, the company posted net income of $1.71 per share compared with the year-ago quarter’s earnings per share (EPS) of $1.69.
Total revenues inched up nearly 0.1% year over year to $1,761.4 million and beat the Zacks Consensus Estimate of $1,756.3 million. Organic sales growth came in at 2.1% in the reported quarter.
Cost of sales in the quarter declined nearly 0.8% year over year to $1.29 billion. Gross profit rose 2.7% year over year to $471.7 million. Gross margin increased to 26.8% from 26.1% in the prior-year quarter.
Marketing, general and administrative expenses totaled $265.3 million compared with $270.5 million reported in the year-ago quarter. Adjusted operating profit came in at $206.4 million, up from the $188.7 million recorded in the prior-year quarter. Adjusted operating margin rose to 11.7% from the year-earlier quarter’s level of 10.7%.
Avery Dennison Corporation Price, Consensus and EPS Surprise
Revenues in the Label and Graphic Materials segment dipped 0.8% year over year to $1,185.1 million. On an organic basis, sales inched up 1.2%. Adjusted operating profit rose 9.1% year on year to $160.2 million.
Revenues in the Retail Branding and Information Solutions segment rose 2.1% year over year to $406.8 million. On an organic basis, sales were up 4.1% as consistent strength in RFID offset slowdown in base business. The segment’s adjusted operating income increased 3.3% to $46.9 million.
Net sales in the Industrial and Healthcare Materials segment amounted to $169.5 million, increasing 1.4% from the prior-year quarter. On an organic basis, sales were up 3.7%. The segment reported adjusted operating income of $18.6 million compared with $15.3 million in the prior-year quarter.
Financial Updates
Avery Dennison had cash and cash equivalents of $224.2 million at the end of the third quarter, up from $217.6 million at the end of the year-ago quarter. During the first nine months of 2019, the company generated $467 million in cash from operating activities compared with $187.7 million reported in the year-ago quarter.
During the third quarter, Avery Dennison repurchased 0.8 million shares for a total cost of $87.6 million. The company’s share count declined 3.8 million in the quarter.
The company’s long-term debt increased to $1,483.7 million as of Sep 28, 2019 compared with $1,295.3 million as of Sep 29, 2018.
Cost-Reduction Activities
Avery Dennison realized around $18 million in pre-tax savings from restructuring in the third quarter. The company incurred pre-tax restructuring charges of nearly $3 million.
Guidance
For 2019, Avery Dennison revised its adjusted EPS guidance to $6.50-$6.60. Including the impact of the pension-settlement charge, the company tightened EPS guidance to $3.15-$3.25 from the prior estimate of $3.15-$3.30.
Price Performance
Shares of Avery Dennison have rallied 33.1% in the past year compared with the industry’s 22% rise.
Zacks Rank and Stocks to Consider
Avery Dennison currently carries a Zacks Rank #4 (Sell).
Plug Power has an estimated earnings growth rate of 2.8% for 2019. The company’s shares have gained 133.9% in the past year.
Cimpress has an expected earnings growth rate of 5% for the current fiscal. The stock has appreciated 26.6% in a year’s time.
Cintas has an estimated earnings growth rate of 12.74% for 2019. Shares of the company have surged 58.5% in the past year.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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Avery Dennison (AVY) Earnings and Sales Top Estimates in Q3
Avery Dennison Corporation (AVY - Free Report) reported adjusted earnings of $1.66 per share in third-quarter 2019, which surpassed the Zacks Consensus Estimate of $1.60. The figure also increased around 14% year over year.
Including one-time items, the company posted net income of $1.71 per share compared with the year-ago quarter’s earnings per share (EPS) of $1.69.
Total revenues inched up nearly 0.1% year over year to $1,761.4 million and beat the Zacks Consensus Estimate of $1,756.3 million. Organic sales growth came in at 2.1% in the reported quarter.
Cost of sales in the quarter declined nearly 0.8% year over year to $1.29 billion. Gross profit rose 2.7% year over year to $471.7 million. Gross margin increased to 26.8% from 26.1% in the prior-year quarter.
Marketing, general and administrative expenses totaled $265.3 million compared with $270.5 million reported in the year-ago quarter. Adjusted operating profit came in at $206.4 million, up from the $188.7 million recorded in the prior-year quarter. Adjusted operating margin rose to 11.7% from the year-earlier quarter’s level of 10.7%.
Avery Dennison Corporation Price, Consensus and EPS Surprise
Avery Dennison Corporation price-consensus-eps-surprise-chart | Avery Dennison Corporation Quote
Segment Highlights
Revenues in the Label and Graphic Materials segment dipped 0.8% year over year to $1,185.1 million. On an organic basis, sales inched up 1.2%. Adjusted operating profit rose 9.1% year on year to $160.2 million.
Revenues in the Retail Branding and Information Solutions segment rose 2.1% year over year to $406.8 million. On an organic basis, sales were up 4.1% as consistent strength in RFID offset slowdown in base business. The segment’s adjusted operating income increased 3.3% to $46.9 million.
Net sales in the Industrial and Healthcare Materials segment amounted to $169.5 million, increasing 1.4% from the prior-year quarter. On an organic basis, sales were up 3.7%. The segment reported adjusted operating income of $18.6 million compared with $15.3 million in the prior-year quarter.
Financial Updates
Avery Dennison had cash and cash equivalents of $224.2 million at the end of the third quarter, up from $217.6 million at the end of the year-ago quarter. During the first nine months of 2019, the company generated $467 million in cash from operating activities compared with $187.7 million reported in the year-ago quarter.
During the third quarter, Avery Dennison repurchased 0.8 million shares for a total cost of $87.6 million. The company’s share count declined 3.8 million in the quarter.
The company’s long-term debt increased to $1,483.7 million as of Sep 28, 2019 compared with $1,295.3 million as of Sep 29, 2018.
Cost-Reduction Activities
Avery Dennison realized around $18 million in pre-tax savings from restructuring in the third quarter. The company incurred pre-tax restructuring charges of nearly $3 million.
Guidance
For 2019, Avery Dennison revised its adjusted EPS guidance to $6.50-$6.60. Including the impact of the pension-settlement charge, the company tightened EPS guidance to $3.15-$3.25 from the prior estimate of $3.15-$3.30.
Price Performance
Shares of Avery Dennison have rallied 33.1% in the past year compared with the industry’s 22% rise.
Zacks Rank and Stocks to Consider
Avery Dennison currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the Industrial Products sector are Plug Power, Inc (PLUG - Free Report) , Cimpress N.V (CMPR - Free Report) and Cintas Corporation (CTAS - Free Report) . While Plug Power and Cimpress sport a Zacks rank #1 (Strong Buy), Cintas carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here
Plug Power has an estimated earnings growth rate of 2.8% for 2019. The company’s shares have gained 133.9% in the past year.
Cimpress has an expected earnings growth rate of 5% for the current fiscal. The stock has appreciated 26.6% in a year’s time.
Cintas has an estimated earnings growth rate of 12.74% for 2019. Shares of the company have surged 58.5% in the past year.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>