Avery Dennison Q2 sales rise 10.9%, beat estimates

Overview

• Materials science firm's preliminary Q2 sales rose 10.9%, beating analyst expectations

• Adjusted EPS for preliminary Q2 rose 19.4%, beating analyst expectations

• Company cites strong organic sales growth and margin expansion as key drivers

Outlook

• Avery Dennison sees FY26 reported EPS of $9.40 to $9.70

• Company expects FY26 adjusted EPS of $10.00 to $10.30

• Company expects to build on current momentum for remainder of 2026

Result Drivers

• MATERIALS GROUP GROWTH - High single-digit volume/mix growth and low single-digit price increases in Materials Group drove segment sales up 15.9%, with both high-value and base categories contributing

• MARGIN EXPANSION - Margin gains were supported by higher volumes, productivity improvements, and net benefit from pricing and raw material costs, partly offset by mix and higher employee-related costs

• PRODUCTIVITY INITIATIVES - Productivity improvements contributed to margin expansion in both Materials and Solutions Groups, partially offset by higher employee-related costs

Company press release: ID:nBw4YTm8Va

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 9 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the non-paper containers packaging peer group is "buy"

• Wall Street's median 12-month price target for Avery Dennison Corp is $204.50, about 22.4% above its July 29 closing price of $167.14

• The stock recently traded at 16 times the next 12-month earnings vs. a P/E of 17 three months ago

Reuters Recommended Reads

• July 27 - Element Solutions Q2 sales beat estimates on electronics segment strength

• July 28 - UK's Essentra H1 revenue rises on volume and pricing

• July 29 - Industrial products maker Fortive lifts profit view on strong automation business

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)