Avery Dennison Outlook - Technical Weakness and Mixed Analyst Sentiment

Avery Dennison Outlook - Technical Weakness and Mixed Analyst Sentiment

1. Market Snapshot

Headline takeaway: With recent price declines of -3.50% and a weak technical outlook, investors are advised to approach Avery Dennison (AVY) cautiously.

2. News Highlights

Here are a few recent developments that could impact Avery Dennison:

• EPE USA's Sustainable Packaging Efforts: EPE USA is making strides in developing eco-friendly packaging solutions, which may attract environmentally conscious investors. While not directly related to AVY, it reflects a growing trend in the sector.
• China's Factory Activity Contracts: China's manufacturing sector saw a slight improvement in May with a PMI of 49.5, still below 50, indicating continued contraction. A slowdown in global demand could indirectly affect Avery Dennison's operations in the packaging and materials sectors.
• Trump Fast-Tracks Utah Uranium Mine: Although unrelated to Avery Dennison's core business, this news highlights a broader industrial policy shift that could affect raw material costs or supply chains in the long term.

3. Analyst Views & Fundamentals

Average analyst rating is 3.80 (simple mean), while the performance-weighted rating is 2.43. This suggests mixed views, with some optimism but a general bearish leaning. Analysts appear to have disagreed in their recent ratings, with a mix of "Strong Buy," "Buy," and "Neutral" assessments.

Analyst ratings vs. price trend: The current price is declining, and the weighted expectations align with this trend, suggesting analysts are generally cautious about near-term prospects.

Fundamental Highlights:

• Net Assets per Share (YoY Growth Rate): -2.65% (internal diagnostic score: 3)
• Shareholders’ Equity / Total Liabilities: 34.58% (internal diagnostic score: 2)
• Total Assets (YoY Growth Rate): 1.95% (internal diagnostic score: 3)
• Equity Multiplier: 389.18% (internal diagnostic score: 2)
• Operating Cycle: 121.77 days (internal diagnostic score: 0)
• Total Operating Revenue (YoY Growth Rate): -0.41% (internal diagnostic score: 2)
• Gross Profit Margin: 28.85% (internal diagnostic score: 0)
• Net Cash Flow from Operating Activities / Operating Revenue: 4.41% (internal diagnostic score: 3)
• PE Ratio: 82.62x (internal diagnostic score: 3)

4. Money-Flow Trends

The overall fund-flow pattern for AVY shows a negative trend with an overall inflow ratio of 47.11%. Notably, large and extra-large investors also show outflows, with inflow ratios of 48.26% and 45.65%, respectively. This suggests that big-money players are stepping back from the stock, while retail investors may be more active, though still with a negative bias.

5. Key Technical Signals

Recent technical analysis is bearish, with an internal diagnostic score of 2.37, suggesting a weak outlook.

• WR Oversold: internal diagnostic score of 3.16—Neutral to slightly bearish signal, suggesting caution.
• Bearish Engulfing: internal diagnostic score of 1.58—Strongly bearish signal, indicating downward momentum.

Recent Chart Activity (Last 5 Days):

• 2025-09-09: WR Oversold and Bearish Engulfing both appeared, signaling strong bearish momentum.
• 2025-09-10 & 2025-09-12: WR Oversold persisted, showing continued weakness without a reversal.

Key Insights: Technical indicators show a dominant bearish trend with 2 bearish vs 0 bullish signals. This weak momentum increases the risk of further declines in the near term.

6. Conclusion

With a weak technical outlook, mixed analyst sentiment, and declining price trends, Avery Dennison (AVY) appears to be in a challenging position. Investors should consider avoiding entry into the stock at this time and wait for a clearer reversal signal or improved fundamentals before reassessing. Those already holding AVY might want to monitor the risk of further downside, particularly in light of the bearish technical indicators.