Avery Dennison (AVY) to Report Q1 Earnings: What's in Store?
Avery Dennison Corporation AVY is scheduled to report first-quarter 2023 results before the opening bell on Apr 26.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter total sales is pegged at $2.18 billion, suggesting a decline of 7.3% from the prior-year quarter’s reported figure. The consensus mark for the company’s earnings per share is pinned at $1.67, indicating a year-over-year decrease of 30.4%. The earnings estimate has moved down 0.4% in the past 60 days.
Avery Dennison Corporation Price and EPS Surprise
Avery Dennison Corporation price-eps-surprise | Avery Dennison Corporation Quote
Q4 Performance
Avery Dennison’s revenues and earnings declined year over year in the fourth quarter of 2022. The company missed the Zacks Consensus Estimate on both counts. AVY has a trailing four-quarter negative earnings surprise of 0.7%, on average.
Factors at Play
Avery Dennison has been bearing the brunt of input cost inflation and supply-chain challenges. Higher paper and energy costs are likely to have impacted the company’s margins in the to-be-reported quarter.
Avery Dennison has been witnessing solid demand for the labeling of non-durable consumer goods like food, beverage, home and personal care products. However, strong demand and supply constraints are likely to have elevated raw material, labor and freight costs in the quarter under review.
Moreover, apparel inventory reductions are likely to have impacted volumes in the quarter under review. Continued destocking is expected to have an impact on margins.
Avery Dennison has been executing several pricing and re-engineering actions to mitigate inflationary cost pressure. It has also announced additional price increases in most of its businesses worldwide.
In the fourth quarter of 2022, Avery combined the Label and Graphic Materials segment and the Industrial and Healthcare Materials segment into the Materials Group. It renamed the Retail Branding and Information Solutions segment as Solutions Group. These restructuring activities are likely to have aided the company’s performance in the first quarter.
The Solutions Group segment is likely to have benefited from solid margin expansions, driven by strength in high-value categories and the base business. Then again, the Materials group segment’s results are expected to reflect gains from strong demand for consumer packaged goods and e-commerce trends.
Nonetheless, these cost and supply-chain headwinds are expected to have offset the benefits in the first quarter.
What the Zacks Model Indicates
Our proven model does not conclusively predict an earnings beat for Avery Dennison this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, but that is not the case here.
You can uncover the best stocks before they're reported with our Earnings ESP Filter.
Earnings ESP: Avery Dennison has an Earnings ESP of 0.00%.
Zacks Rank: Avery Dennison currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Price Performance
Avery Dennison’s shares have gained 6% in the past year against the industry’s fall of 1.1%.
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Stocks to Consider
Here are some Industrial Products stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases.
Ingersoll Rand Inc. IR is scheduled to report first-quarter 2023 results on May 3. It has an Earnings ESP of +2.32% and currently sports a Zacks Rank #1. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at 52 cents per share. This suggests year-over-year growth of 6.1%.
The Zacks Consensus Estimate for IR’s quarterly revenues is pegged at $1.5 billion, indicating year-over-year growth of 10.7%. IR has a trailing four-quarter earnings surprise of 8.5%, on average.
A. O. Smith Corporation AOS is set to release its first-quarter 2023 results on Apr 27. AOS currently has an Earnings ESP of +5.78% and a Zacks Rank #2. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at 77 cents per share, suggesting no year-over-year change.
The Zacks Consensus Estimate for AOS’ quarterly revenues is pegged at $913 million, indicating a year-over-year decline of 6.5%. The company has a trailing four-quarter earnings surprise of 3.2%, on average.
Illinois Tool Works ITW is scheduled to report first-quarter 2023 results on May 2. The company currently has an Earnings ESP of +1.49% and a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter 2023 earnings is pegged at $2.19 per share. This suggests year-over-year growth of 3.8%
The Zacks Consensus Estimate for quarterly revenues is pegged at $4 billion, indicating growth of 0.6% from the prior-year quarter’s reported level. ITW has a trailing four-quarter earnings surprise of 0.9%, on average.
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Illinois Tool Works Inc. (ITW) : Free Stock Analysis Report
Avery Dennison Corporation (AVY) : Free Stock Analysis Report
A. O. Smith Corporation (AOS) : Free Stock Analysis Report
Ingersoll Rand Inc. (IR) : Free Stock Analysis Report
