Avery Dennison Corporation produces and sells pressure-sensitive materials worldwide. It operates through Pressure-Sensitive Materials, Retail Branding and Information Solutions, and Vancive Medical Technologies segments. The company was founded in 1935 and is based in Glendale, California.
AVY Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Avery Dennison Corp. To summarize, we found that Avery Dennison Corp ranked in the 43th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 17.67%. In terms of the factors that were most noteworthy in this DCF analysis for AVY, they are:
AVY's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 25.29% of tickers in our DCF set.
Avery Dennison Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 9.92. This coverage rate is greater than that of 76.45% of stocks we're observing for the purpose of forecasting via discounted cash flows.
The weighted average cost of capital for the company is 8. This value is greater than just 21.33% stocks in the Industrials sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as AVY, try CSX, KAI, UPS, WAB, and ETN.
Avery Dennison Corporation (AVY), whose portfolio encompasses pressure-sensitive materials and a wide range of tickets, tags, labels, and other converted products, has been increasing the quarterly DPS for 10 consecutive years since the sharp cut in payout amid the Great Recession. In 2020, the company has decided not to trim...
Vasily Zyryanov on Seeking Alpha | August 31, 2020
GLENDALE, Calif.--(BUSINESS WIRE)--Avery Dennison Corporation (NYSE: AVY) today announced the following investor events: A conference call hosted by Citi to provide a mid-quarter update on business trends, a Q&A with Mitch Butier, chairman, president, and chief executive officer, to be held on Monday, September 14th, beginning at 4:30 PM ET and expected to conclude by 5:15 PM ET. Credit Suisse Virtual Basic Materials Conference, on Wednesday, September 16th. Greg Lovins, senior vice preside