The strong beat and raised guidance signal accelerating momentum in both Materials and Solutions segments. However, management's expectation that customer inventory destocking will weigh on 2H organic growth suggests Q3 sequential earnings may decline more than seasonal norms. Watch for Q3 guidance on the call and any signs of demand softening in base categories.
Price Chart
Executive Summary
Avery Dennison reported a strong Q2 2026 beat, with adjusted EPS of $2.89 (17% above consensus of $2.47) and revenue of $2.46B (7% above $2.30B consensus). Organic sales grew 7.6%, margins expanded, and the company initiated FY2026 adjusted EPS guidance of $10.00-$10.30, well above prior expectations. The results reflect broad-based volume growth and operational leverage, though management noted customer inventory stocking contributed ~half of organic growth and expects destocking in 2H.
Key Financial Metrics
Key Facts
- Adjusted EPS $2.89 vs consensus $2.47 (+17.0% beat)
- Revenue $2.46B vs consensus $2.30B (+7.1% beat)
- Organic sales growth of 7.6% (ex-currency +8.9%)
- Adjusted EBITDA margin expanded 50 bps to 17.1%
- FY2026 adjusted EPS guidance initiated at $10.00-$10.30
- Adjusted free cash flow of $365M in Q2, YTD $470M
- Net debt to adjusted EBITDA improved to 2.3x
- Company repurchased $198M in shares YTD
Financial Impact
EPS beat of $0.42 vs consensus, revenue beat of $163M; guidance midpoint $10.15 implies ~15% YoY growth at the midpoint
Risk Factors
- Customer inventory destocking expected in 2H could slow organic growth to 3-4%
- Geopolitical and tariff uncertainties remain headwinds
- Higher employee-related costs and mix pressure may limit further margin expansion
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0000008818-26-000127 |
| Exhibit: ex9928k7-30x26.htm | 0000008818-26-000127 |
| Document: avy-20260730.htm | 0000008818-26-000127 |
| Document: 0000008818-26-000127-index-headers.html | 0000008818-26-000127 |
| Document: 0000008818-26-000127-index.html | 0000008818-26-000127 |
| Document: 0000008818-26-000127.txt | 0000008818-26-000127 |
| 8-K Data (Synthetic) | 0000008818-26-000127 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 27, 2026 today | SC 13G/A | $181.70 | awaiting T+60 | — | $181.71 (+0.01%) |
Oct 21, 2026 6d ago | Institutional Cluster | $184.66 | awaiting T+60 | — | $181.71 (−1.60%) |
Oct 13, 2026 14d ago | 8-K | $170.72 | awaiting T+60 | — | $181.71 (+6.44%) |
Oct 5, 2026 22d ago | 8-K | $170.00 | awaiting T+60 | — | $181.71 (+6.89%) |
Aug 19, 2026 9w ago | 8-K | $183.16 | awaiting T+60 | — | $181.71 (−0.79%) |
Jul 30, 2026 12w ago | 8-K | $174.82 $181.83 | ▲ +4.01% | ▲ +1.55% | $181.71 (+3.94%) |
Jun 4, 2026 20w ago | 8-K | $153.25 $177.75 | ▲ +15.99% | ▲ +14.11% | $181.71 (+18.57%) |
Apr 28, 2026 26w ago | 8-K | $165.43 $155.20 | ▼ −6.18% | ▼ −10.17% | $181.71 (+9.84%) |
Mar 12, 2026 32w ago | DEFA14A | $171.01 $155.18 | ▼ −9.26% | ▼ −19.95% | $181.71 (+6.26%) |
US Market Status
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