Ball Corporation (NYSE: BLL) and Avery Dennison Corporation (NYSE:AVY) are both mid-cap industrial products companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, dividends, profitability, earnings and risk.

Dividends

Ball Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 1.0%. Avery Dennison Corporation pays an annual dividend of $1.80 per share and has a dividend yield of 1.9%. Ball Corporation pays out 78.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Avery Dennison Corporation pays out 42.3% of its earnings in the form of a dividend. Ball Corporation has increased its dividend for 6 consecutive years. Avery Dennison Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Ball Corporation and Avery Dennison Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ball Corporation $10.60 billion 1.30 $1.59 billion $0.51 77.06
Avery Dennison Corporation $6.26 billion 1.32 $792.50 million $4.26 21.99

Ball Corporation has higher revenue and earnings than Avery Dennison Corporation. Avery Dennison Corporation is trading at a lower price-to-earnings ratio than Ball Corporation, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ball Corporation and Avery Dennison Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ball Corporation 1.70% 17.63% 3.92%
Avery Dennison Corporation 6.14% 39.29% 8.44%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Ball Corporation and Avery Dennison Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ball Corporation 0 6 4 0 2.40
Avery Dennison Corporation 0 2 4 0 2.67

Ball Corporation currently has a consensus target price of $43.61, suggesting a potential upside of 10.97%. Avery Dennison Corporation has a consensus target price of $90.60, suggesting a potential downside of 3.28%. Given Ball Corporation’s higher possible upside, equities analysts clearly believe Ball Corporation is more favorable than Avery Dennison Corporation.

Volatility and Risk

Ball Corporation has a beta of 0.95, indicating that its share price is 5% less volatile than the S&P 500. Comparatively, Avery Dennison Corporation has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500.

Insider and Institutional Ownership

53.0% of Ball Corporation shares are owned by institutional investors. Comparatively, 88.3% of Avery Dennison Corporation shares are owned by institutional investors. 2.7% of Ball Corporation shares are owned by company insiders. Comparatively, 1.4% of Avery Dennison Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Avery Dennison Corporation beats Ball Corporation on 10 of the 16 factors compared between the two stocks.

Ball Corporation Company Profile

Ball Corporation is a supplier of metal packaging to the beverage, food, personal care and household products industries. The Company’s packaging products are produced for a range of end uses and are manufactured in facilities around the world. Its segments include beverage packaging, North and Central America; beverage packaging, South America; beverage packaging, Europe; food and aerosol packaging; aerospace, and other. Its major product line is aluminum and steel beverage containers. It produces steel food, aerosol and extruded aluminum aerosol containers and aluminum slugs. Its aerospace business designs, develops and manufactures aerospace systems for civil, commercial and national cyber security aerospace markets. It produces spacecraft, instruments and sensors, radio frequency systems and components, data exploitation solutions and a range of aerospace technologies and products.

Avery Dennison Corporation Company Profile

Avery Dennison Corporation (Avery Dennison) is engaged in the production of pressure-sensitive materials and a range of tickets, tags, labels and other converted products. The Company’s segments include Label and Graphic Materials (LGM); Retail Branding and Information Solutions (RBIS), and Industrial and Healthcare Materials (IHM). The Company’s LGM segment manufactures and sells Fasson-, JAC-, and Avery Dennison-brand pressure-sensitive label and packaging materials, Avery Dennison- and Mactac-brand graphics, and Avery Dennison-brand reflective products. The Company’s RBIS segment designs, manufactures and sells a range of branding and information solutions to retailers, brand owners, apparel manufacturers, distributors and industrial customers on a global basis. The Company’s IHM segment manufactures and sells Fasson-brand and Avery Dennison-brand tapes and fasteners, Vancive-brand medical pressure-sensitive adhesive (PSA) based materials and products, and performance polymers.

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