Avery Dennison AVY Q2 2025 Earnings Preview Downside Risk Amid Lower Revenue and Higher Costs

Generated by AI AgentAinvestweb
Saturday, Jul 19, 2025 9:44 pm ET1min read
Aime RobotAime Summary

- Avery Dennison faces Q2 2025 earnings/revenue declines amid rising costs, despite 8.9% stock price growth expectations from analysts.

- Analysts maintain "Buy" ratings with $196.9 price target, though margin pressures persist from higher input costs.

- Full-year guidance forecasts 3.8% revenue and 7.4% earnings growth, with EPS expected to rise 9% annually.

- Q2 results (July 22 release) will test cost management strategies amid strong business volumes and stable market positioning.

Forward-Looking Analysis
The market anticipates to report a year-over-year decline in earnings and lower revenues for 2025 Q2. Analysts expect the company's earnings for the year to be between $734.85 million and $747.49 million. Despite a consensus "Buy" rating from ten analysts and a price target of $196.9, indicating an 8.9% potential stock price increase, higher costs are expected to pressure margins this quarter. Avery Dennison is forecasted to grow revenue and earnings by 3.8% and 7.4% annually, respectively, with an EPS growth expectation of 9% annually. The company has provided full-year earnings guidance with an EPS range of $9.55 to $9.95.

Historical Performance Review
In Q1 2025, Avery Dennison reported revenue of $2.15 billion, with a net income of $166.30 million. The earnings per share (EPS) stood at $2.11, while the gross profit was $621.50 million. This performance highlights the company’s ability to maintain profitability amidst challenging market conditions.

Additional News
Avery Dennison is set to announce its Q2 earnings on July 22, 2025. Despite stronger volumes in its major business segments, the company faces higher costs that could impact profitability. Analysts continue to support the stock with a "Buy" rating and an 8.9% stock price increase expectation. There is no significant news related to new products, services, or mergers and acquisitions. The company's ongoing strategic focus appears to be on managing cost pressures while capitalizing on existing demand.

Summary & Outlook
Overall, Avery Dennison maintains a stable financial health with anticipated growth in revenue and earnings despite current challenges. The significant risk of higher costs could impact margins in the upcoming quarter. Although analysts maintain a positive outlook with a "Buy" rating and a price target increase, the company faces downside risks. This suggests a cautious stance, potentially neutral, on future prospects, given the anticipated declines in earnings and revenue amidst cost pressures.

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