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Avery Dennison (AVY) Beats on Q1 Earnings, Ups View

Avery Dennison Corporation AVY is a global leader in labeling and packaging materials and solutions. Its applications and technologies are an integral part of products used across every major market and industry. Its products are sold under the Avery, Avery Dennison, Avery Graphics and Fasson brands.

Avery Dennison continues to focus on expanding in emerging markets and developing innovative new products to enable share gain and application growth. The Pressure Sensitive Materials and Retail Brandings segments are poised for long-term growth. However, near-term headwinds remain in the form of weak market demand in the U.S and Europe for the PSM segment. Moreover, given Avery Dennison’s significant exposure to international operations, currency volatility remains a concern.

Let’s have a quick look at the first-quarter 2016 earnings release of this Pasadena Calif. based manufacturer of pressure-sensitive materials.

Estimate Trend & Surprise History: You should note that the earnings estimate revisions for Avery Dennison depicted a neutral stance prior to the earnings release. The Zacks Consensus Estimate has remained stable over the last 30 days and currently stands at 86 cents for the first quarter.

Coming to earnings surprise history, Avery Dennison has a good track record. In the past 4 quarters, the company has outpaced the Zacks Consensus Estimate on all occasions, with an average beat of 8.21%.

Earnings: Avery Dennison beat on earnings by 9%. Our consensus called for EPS of 86 cents, and the company reported EPS of 94 cents.

Revenue: It reported first-quarter 2016 revenues of $1,486 million, falling short of the Zacks Consensus Estimate of $1,496 million.

Key Developments to Note: For 2016, Avery Dennison raised its adjusted earnings per share guidance to a new range of $3.75 to $3.90 from the previous range of $3.65 to $3.85.

Zacks Rank: Currently Avery Dennison has a Zacks Rank #2 (Buy). However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change.

Market Reaction: Shares remained flat in pre-market trading following the release, at the time of this write-up.

Check back later for our full write up on this Avery Dennison earnings report later!

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