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Avery Dennison Corporation (AVY)

Company Dividend Discount ModelIndustry: Business Equipment & SuppliesSector: Industrials

Valuation Snapshot

Stable Growth$206.28 - $547.21$315.43
Multi-Stage$143.98 - $157.15$150.45
Blended Fair Value$232.94
Current Price$160.75
Upside44.91%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222022202120192018201720162016
DPS7.90%8.29%3.513.253.022.792.492.402.211.971.801.68
YoY Growth--8.10%7.45%8.30%12.09%3.74%8.40%12.54%9.12%7.06%6.39%
Dividend Yield--2.00%1.45%1.69%1.59%1.32%2.39%1.96%1.85%2.24%2.31%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)695.60
(-) Cash Dividends Paid (M)286.40
(=) Cash Retained (M)409.20
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)139.1286.9552.17
Cash Retained (M)409.20409.20409.20
(-) Cash Required (M)-139.12-86.95-52.17
(=) Excess Retained (M)270.08322.25357.03
(/) Shares Outstanding (M)79.1079.1079.10
(=) Excess Retained per Share3.414.074.51
LTM Dividend per Share3.623.623.62
(+) Excess Retained per Share3.414.074.51
(=) Adjusted Dividend7.047.698.13
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Fair Value$206.28$315.43$547.21
Upside / Downside28.33%96.22%240.41%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)695.60740.81788.97840.25894.87953.03981.62
Payout Ratio41.17%50.94%60.70%70.47%80.23%90.00%92.50%
Projected Dividends (M)286.40377.36478.93592.12717.99857.73908.00

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)342.64345.89349.14
Year 2 PV (M)394.86402.38409.98
Year 3 PV (M)443.27455.99468.96
Year 4 PV (M)488.05506.82526.12
Year 5 PV (M)529.40554.97581.51
PV of Terminal Value (M)9,190.309,634.1910,095.07
Equity Value (M)11,388.5111,900.2412,430.78
Shares Outstanding (M)79.1079.1079.10
Fair Value$143.98$150.45$157.15
Upside / Downside-10.43%-6.41%-2.24%

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