Avery Dennison (Avery Dennison) Sloan Ratio %

: 1.66% (As of Dec. 2023)

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Richard Sloan from the University of Michigan was first to document what is referred to as the "accrual anomaly". His 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones.

Avery Dennison's Sloan Ratio for the quarter that ended in Dec. 2023 was 1.66%.

As of Dec. 2023, Avery Dennison has a Sloan Ratio of 1.66%, indicating the company is in the safe zone and there is no funny business with accruals.

Avery Dennison Sloan Ratio % Historical Data

The historical data trend for Avery Dennison's Sloan Ratio % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Avery Dennison Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Sloan Ratio %

-3.50

5.90

17.95

1.62

1.66

Avery Dennison Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Sloan Ratio %																1.62	2.51	3.79	0.86	1.66

Competitive Comparison

For the Packaging & Containers subindustry, Avery Dennison's Sloan Ratio %, along with its competitors' market caps and Sloan Ratio % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Avery Dennison Sloan Ratio % Distribution

For the Packaging & Containers industry and Consumer Cyclical sector, Avery Dennison's Sloan Ratio % distribution charts can be found below:

* The bar in red indicates where Avery Dennison's Sloan Ratio % falls into.

Avery Dennison Sloan Ratio % Calculation

Earnings contain a lot of non cash earnings which is called accruals. The Sloan ratio is a way to identify firms with low non-cash or accrual-derived earnings relative to their cash flow.

Avery Dennison's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as

Sloan Ratio	=	(Net Income (A: Dec. 2023 )	-	Cash Flow from Operations (A: Dec. 2023 )
	-	Cash Flow from Investing (A: Dec. 2023 ))	/	Total Assets (A: Dec. 2023 )
	=	(503	-	826
	-	-459)	/	8209.8
	=	1.66%

Avery Dennison's Sloan Ratio for the quarter that ended in Dec. 2023 is calculated as

Sloan Ratio	=	(Net Income (TTM)	-	Cash Flow from Operations (TTM))
	-	Cash Flow from Investing (TTM))	/	Total Assets (Q: Dec. 2023 )
	=	(503	-	826
	-	-459)	/	8209.8
	=	1.66%

Avery Dennison's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 121.2 (Mar. 2023 ) + 100.4 (Jun. 2023 ) + 138.3 (Sep. 2023 ) + 143.1 (Dec. 2023 ) = $503 Mil.
Avery Dennison's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 1.9 (Mar. 2023 ) + 189.6 (Jun. 2023 ) + 322.6 (Sep. 2023 ) + 311.9 (Dec. 2023 ) = $826 Mil.
Avery Dennison's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -116.6 (Mar. 2023 ) + -205.3 (Jun. 2023 ) + -22.3 (Sep. 2023 ) + -114.8 (Dec. 2023 ) = $-459 Mil.

Avery Dennison (NYSE:AVY) Sloan Ratio % Explanation

A former University of Michigan researcher, Richard Sloan's 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones. In fact, for the 40-year period between 1962 and 2001, buying the lowest accrual companies and shorting the highest accrual companies resulted in an average annual compounded return of 18%, more than double the S&P 500's 7.4% annual return over the same period.

According to How to Beat the Market with the Sloan Ratio:

If the Sloan Ratio is between -10% and 10%, the company is in the safe zone and there is no funny business with accruals.

If the Sloan Ratio is less than between -25% and -10% on the negative side, and between 10% and 25% on the positive side, this is a warning stage of accrual build up.

If the Sloan Ratio is less than -25% or greater than 25%, and this ratio is consistent over several quarters or even years, be careful. Earnings are highly likely to be made up of accruals.

As of Dec. 2023, Avery Dennison has a Sloan Ratio of 1.66%, indicating the company is in the safe zone and there is no funny business with accruals.

Avery Dennison Sloan Ratio % Related Terms

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Avery Dennison (Avery Dennison) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Packaging & Containers » Avery Dennison Corp (NYSE:AVY) » Definitions » Sloan Ratio %

Comparable Companies

Traded in Other Exchanges

AV3:Germany AVY:Argentina

Address

8080 Norton Parkway, Mentor, OH, USA, 44060

Website

https://www.averydennison.com

Avery Dennison manufactures pressure-sensitive materials, merchandise tags, and labels. The company also runs a specialty converting business that produces radio-frequency identification, or RFID, inlays and labels. Avery Dennison draws a significant amount of revenue from outside the United States, with international operations accounting for the majority of total sales.

Executives

Ignacio J Walker	officer: VP and Chief Legal Officer	207 GOODE AVE, GLENDALE CA 91203
Divina Fe Santiago	officer: VP Controller	8080 NORTON PARKWAY, MENTOR OH 44060
Julia A Stewart	director	4551 WEST 107TH STREET STE 100, C/O APPLEBEES INTERNATIONAL INC, OVERLAND PARK KS 66207
Francisco Melo	officer: President, Solutions Group	8080 NORTON PARKWAY, MENTOR OH 44060
Hassan Rmaile	officer: President, Materials Group	1200 WILLOW LAKE BLVD, P.O. BOX 64683, ST. PAUL MN 55110
Andres Alberto Lopez	director	ONE MICHAEL OWENS WAY, PERRYSBURG OH 43551
Francesca Reverberi	director	C/O TRINSEO S.A., 1000 CHESTERBROOK BLVD., SUITE 300, BERWYN PA 19312
Anthony Anderson	director	1100 N. WOOD DALE ROAD, WOOD DALE IL 60191
Martha N. Sullivan	director	529 PLEASANT STREET, MS B-7, ATTLEBORO MA 02703
William Raymond Wagner	director	C/O VOCUS, INC., 4296 FORBES BOULEVARD, LANHAM MD 20706
Bradley A Alford	director	150 N ORANGE GROVE BLVD, PASADENA CA 91103
Deena Baker-nel	officer: VP & Chief HR Officer	207 GOODE AVE, GLENDALE CA 91203
Gregory Lovins	officer: V.P. and Interim CFO	207 GOODE AVENUE, GLENDALE CA 91203
Ken C Hicks	director	150 N. ORANGE GROVE BLVD, PASADENA CA 91103
Nicholas Colisto	officer: VP & Chief Information Officer	C/O AVERY DENNISON CORPORATION, 207 GOODE AVE, GLENDALE CA 91203