MENTOR, Ohio – Avery Dennison Corporation (NYSE:AVY), a global materials science company specializing in the design and manufacture of a wide variety of labeling and functional materials, announced today a change in its executive team.
Gregory S. Lovins, who served as Senior Vice President and Chief Financial Officer, has commenced a medical leave of absence effective Thursday. Consequently, he has ceased his role as the principal financial officer of the company.
Following this development, the Board of Directors of Avery Dennison has appointed Danny G. Allouche as the Senior Vice President and Interim Chief Financial Officer, effective from today. Allouche, 50, has been with the company since August 2010 and has held multiple leadership positions. Most recently, he served as the Senior Vice President and Chief Strategy and Corporate Development Officer since August 2022.
The company stated that Allouche will maintain his current compensation package, which includes an annual base salary of approximately $450,000, a target Annual Incentive Plan opportunity of 50%, and a target annual long-term incentive opportunity of 120%. This decision was made considering the interim nature of the appointment and the proximity to the company's annual executive compensation review.
Avery Dennison has not disclosed the expected duration of Lovins' leave. Meanwhile, Allouche will also retain his role as Chief Strategy and Corporate Development Officer in addition to his interim CFO responsibilities.
The announcement was made through a filing with the Securities and Exchange Commission.
In other recent news, Avery Dennison Corporation reported strong third-quarter earnings, with a 9% increase in adjusted earnings per share year-over-year, reaching $2.33. The company also raised its full-year earnings guidance to between $9.35 and $9.50 per share. Despite a challenging macroeconomic environment, Avery Dennison anticipates an organic sales growth between 4.5% and 5%.
In corporate governance developments, Ken C. Hicks, a long-standing board member, has resigned from Avery Dennison to assume his new role as President and CEO of PetSmart LLC. Avery Dennison also successfully closed the issuance of €500 million in senior notes due in 2034, with proceeds being used to repay existing debt and for general corporate purposes.
In analyst notes, Citi reduced its price target on Avery Dennison from $240 to $228, maintaining a Neutral rating, while BMO Capital Markets reduced its price target to $247 from $252, but maintained an Outperform rating. Both firms cited a pattern of lowered sales growth outlooks for Avery Dennison's Industrial Labels segment.
In other company news, Avery Dennison is expanding its Radio-Frequency Identification (RFID) technology into the food category, piloting this technology in approximately 2,800 Kroger (NYSE:KR) bakeries. The company's restructuring actions are expected to save over $55 million.
These are the recent developments for Avery Dennison.
InvestingPro Insights
As Avery Dennison navigates this leadership transition, InvestingPro data provides additional context for investors. The company's market capitalization stands at $16.06 billion, reflecting its significant presence in the materials science industry. Despite recent executive changes, Avery Dennison maintains a solid financial foundation with a revenue of $8.68 billion over the last twelve months as of Q3 2023, showing a 4.84% growth.
InvestingPro Tips highlight Avery Dennison's commitment to shareholder value. The company has raised its dividend for 14 consecutive years and has maintained dividend payments for an impressive 54 consecutive years. This consistent dividend policy may provide some reassurance to investors during the CFO transition period.
Additionally, with a P/E ratio of 23.85, Avery Dennison is trading at a relatively low P/E ratio compared to its near-term earnings growth potential. This could suggest that the stock may be undervalued, especially considering it's trading near its 52-week low.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips on Avery Dennison, providing deeper insights into the company's financial health and market position.
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