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Avery Dennison (Avery Dennison) Beneish M-Score

: -2.55 (As of Today)
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The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.55 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Avery Dennison's Beneish M-Score or its related term are showing as below:

AVY' s Beneish M-Score Range Over the Past 10 Years
Min: -2.66   Med: -2.56   Max: -2.36
Current: -2.55

During the past 13 years, the highest Beneish M-Score of Avery Dennison was -2.36. The lowest was -2.66. And the median was -2.56.


Avery Dennison Beneish M-Score Historical Data

The historical data trend for Avery Dennison's Beneish M-Score 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.

* Premium members only.

Avery Dennison Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.37 -2.54 -2.41 -2.64 -2.55

Avery Dennison Quarterly Data
Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.64 -2.68 -2.61 -2.70 -2.55

Competitive Comparison

For the Packaging & Containers subindustry, Avery Dennison's Beneish M-Score, along with its competitors' market caps and Beneish M-Score 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 Beneish M-Score Distribution

For the Packaging & Containers industry and Consumer Cyclical sector, Avery Dennison's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Avery Dennison's Beneish M-Score falls into.



Avery Dennison Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Avery Dennison for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.1125+0.528 * 0.9768+0.404 * 1.011+0.892 * 0.9253+0.115 * 1.0238
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0655+4.679 * -0.02106-0.327 * 0.9718
=-2.55

* 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.

This Year (Dec23) TTM:Last Year (Dec22) TTM:
Total Receivables was $1,415 Mil.
Revenue was 2110.5 + 2098.3 + 2090.5 + 2065 = $8,364 Mil.
Gross Profit was 596 + 585.8 + 553.4 + 542.3 = $2,278 Mil.
Total Current Assets was $2,796 Mil.
Total Assets was $8,210 Mil.
Property, Plant and Equipment(Net PPE) was $1,626 Mil.
Depreciation, Depletion and Amortization(DDA) was $298 Mil.
Selling, General, & Admin. Expense(SGA) was $1,178 Mil.
Total Current Liabilities was $2,700 Mil.
Long-Term Debt & Capital Lease Obligation was $2,622 Mil.
Net Income was 143.1 + 138.3 + 100.4 + 121.2 = $503 Mil.
Non Operating Income was -37.6 + -37.6 + -61.7 + -13.2 = $-150 Mil.
Cash Flow from Operations was 311.9 + 322.6 + 189.6 + 1.9 = $826 Mil.
Total Receivables was $1,374 Mil.
Revenue was 2025.9 + 2317.1 + 2347 + 2349.3 = $9,039 Mil.
Gross Profit was 500.2 + 619.2 + 643.5 + 641.3 = $2,404 Mil.
Total Current Assets was $2,782 Mil.
Total Assets was $7,951 Mil.
Property, Plant and Equipment(Net PPE) was $1,540 Mil.
Depreciation, Depletion and Amortization(DDA) was $291 Mil.
Selling, General, & Admin. Expense(SGA) was $1,195 Mil.
Total Current Liabilities was $2,800 Mil.
Long-Term Debt & Capital Lease Obligation was $2,504 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1414.9 / 8364.3) / (1374.4 / 9039.3)
=0.169159 / 0.152047
=1.1125

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(2404.2 / 9039.3) / (2277.5 / 8364.3)
=0.265972 / 0.272288
=0.9768

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2796 + 1625.8) / 8209.8) / (1 - (2782 + 1540.2) / 7950.5)
=0.4614 / 0.456361
=1.011

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=8364.3 / 9039.3
=0.9253

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(290.7 / (290.7 + 1540.2)) / (298.4 / (298.4 + 1625.8))
=0.158774 / 0.155077
=1.0238

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1177.9 / 8364.3) / (1194.7 / 9039.3)
=0.140825 / 0.132167
=1.0655

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((2622.1 + 2699.5) / 8209.8) / ((2503.5 + 2799.8) / 7950.5)
=0.648201 / 0.66704
=0.9718

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(503 - -150.1 - 826) / 8209.8
=-0.02106

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Avery Dennison has a M-score of -2.55 suggests that the company is unlikely to be a manipulator.


Avery Dennison Beneish M-Score Related Terms

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Avery Dennison (Avery Dennison) Business Description

Traded in Other Exchanges
Address
8080 Norton Parkway, Mentor, OH, USA, 44060
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

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