Stock Analysis | Avery Dennison Outlook - A Deep Dive into Weak Technicals, Mixed Analysts, and Strong Fund-Flow Trends

Market Snapshot

Outlook: Cautious on technicals, mixed on fundamentals. Despite a 3.89% price rise recently, internal technical indicators are bearish (score 2.79), while fundamentals and fund flows show moderate strength.

News Highlights

• Mondelez sues Aldi for alleged cookie packaging copying. Although this doesn’t directly affect Avery Dennison, it highlights growing competition and brand-value sensitivity in packaging sectors.
• EPE USA announces eco-friendly packaging initiatives. This reflects a growing industry trend that Avery Dennison may need to keep up with, especially as sustainability becomes a key consumer concern.
• Cleanfarms starts recycling pilot program for agricultural plastics in Canada. As a packaging company, Avery Dennison should monitor similar programs and their potential impact on demand for sustainable solutions.

Analyst Views & Fundamentals

Average Analyst Rating (Simple Mean): 3.80
Performance-Weighted Rating: 2.43
Analysts are broadly divided. Citigroup and JP Morgan show better historical performance (win rates of 66.7% and 75.0%, respectively), while others like BMO and Raymond James have weaker records.

Despite a positive price trend, ratings remain inconsistent (Neutral, Strong Buy, and Buy ratings are spread out), and the weighted score does not align with the price rise. Analysts appear to be cautious, which contrasts with the short-term upward move in shares.

Key Fundamental Factors:

• Return on Equity (ROE, annualized): 31.49% – internal score 0 (weak).
• Operating Revenue (YoY growth): -0.41% – internal score 1 (below average).
• Net Cash Flow / Operating Revenue: 4.41% – internal score 1 (moderate).
• Shareholders' Equity Growth: -4.79% – internal score 3 (better than others).
• Basic Earnings Per Share (EPS) Growth: 3.92% – internal score 1 (below average).

Money-Flow Trends

Avery Dennison is seeing positive fund flows across all investor categories. The overall inflow ratio is 50.92%, meaning just under half of institutional and retail investors are buying. Large and extra-large investors are particularly active, with inflow ratios of 51.44% and 50.48%, respectively.

This suggests confident buying by big-money players, who may be positioning for long-term value. Retail investors are also contributing, with a 51.87% inflow ratio. The overall fund-flow score is 7.86, classified as “good,” indicating healthy capital inflow from both institutional and retail segments.

Key Technical Signals

From a technical standpoint, Avery Dennison is showing signs of weakness. The internal technical score is 2.79, and bearish signals are dominating.

• WR Overbought (internal score 1.00) – historically associated with poor returns and low win rates.
• Bearish Engulfing (internal score 2.27) – suggests bearish reversal potential.
• MACD Golden Cross (internal score 2.48) – neutral to bearish given recent performance.
• Marubozu White (internal score 5.43) – a rare positive signal in an otherwise bearish environment.

Recent chart patterns (Aug 12–22, 2025):

• Aug 22: WR Overbought + Marubozu White (mixed signals)
• Aug 15: Bearish Engulfing (negative reversal)

Key Insight: The technical trend is bearish overall, with 3 bearish indicators vs. 0 bullish. Investors should be cautious about short-term declines.

Conclusion

Avery Dennison is showing a conflicting mix of signals: strong fund flows and mixed fundamentals on one side, and weak technicals on the other. While big-money investors are accumulating, the chart pattern suggests a potential pullback is likely.

Actionable Takeaway: Consider waiting for a consolidation or correction before entering long positions. Monitor the next earnings release and any follow-up news on sustainability initiatives to gauge long-term momentum.