Avery Dennison Raises Dividend 6.4% to $1.00, Extends 15-Year Streak

Avery Dennison Corporation raised its quarterly dividend 6.4% to $1.00 per share from $0.94. The first payment at the higher rate went ex-dividend on June 3, 2026, lifting the annual dividend to $4.00 per share.

Why the dividend changed

Avery Dennison did not attribute the increase to a single event. Its regulatory filing records the higher rate as part of regular capital deployment, while management describes its broader approach as balancing investment in the business with cash returns to shareholders. Nothing in the filing connects the increase to a stock split, merger, spin-off or special distribution. Avery Dennison’s second-quarter Form 10-Q confirms the change.

The operating backdrop at the time included stronger earnings and positive cash generation. First-quarter net sales were $2.3 billion, reported earnings were $2.18 per share and adjusted earnings were $2.47 per share, up 7.4%. Organic sales increased 1.1%. Chief Executive Deon Stander said productivity, procurement and cost management were helping the company offset inflation and maintain supply continuity. The first-quarter results also described free cash flow as strong.

Performance strengthened in the following quarter. Avery Dennison reported second-quarter adjusted earnings of $2.89 per share, up 19.4%, as organic sales increased 7.6%. It set full-year reported earnings guidance at $9.40 to $9.70 per share and adjusted guidance at $10.00 to $10.30. Management said productivity and service-led differentiation supported margin expansion while the company continued returning capital to shareholders. The second-quarter release provides the latest operating context.

Dividend track record

The payment sequence shows a measured progression rather than a one-time distribution. The quarterly amount was $0.88 for the payments that went ex-dividend on December 4, 2024, and March 5, 2025. It increased to $0.94 beginning June 4, 2025, remained there through March 4, 2026, and then moved to $1.00 for the June 3, 2026, and September 2, 2026, payments.

Full-year distributions rose from $2.36 per share in 2020 to $3.70 in 2025. Annual growth slowed from 12.7% in 2021 to 7.2% in 2025, although the five-year annualized dividend growth rate remained 10.1%. The latest increase extends the growth streak to 15 consecutive years. The last annual cut occurred in 2010, making the current run long but not uninterrupted across the company’s full history.

Is the dividend covered?

The dividend uses 42% of earnings. That leaves a majority of reported profit outside the distribution for reinvestment, acquisitions, debt service and share repurchases. The $4.00 annual dividend also remains below the company’s latest full-year earnings guidance, consistent with the reported payout ratio.

SmarterDividends rates the dividend A with a safety score of 81. That places it in the very safe range of 80-100, reflecting the moderate earnings payout, the 15-year growth record and the absence of an annual cut since 2010. The grade describes current coverage and resilience rather than guaranteeing future payments.

Yield and valuation

At a share price of $169.75, Avery Dennison’s forward yield is 2.32%. That is below the Consumer Cyclical sector median forward yield of 2.66%, meaning the shares currently provide less dividend income per dollar invested than the sector median.

SmarterDividends estimates fair value at $137.78 and classifies the shares as overvalued. The estimate is 18% below the current share price. The stock’s one-year price return is a decline of 4.1%, but the market price remains above that fair-value estimate.

What to watch

The next operating checkpoint is Avery Dennison’s third-quarter report. Investors can track whether management maintains its full-year reported earnings guidance of $9.40 to $9.70 per share and adjusted guidance of $10.00 to $10.30. Materials Group volume and pricing, raw-material costs, Solutions Group margins and employee-related expenses are the principal operating variables identified in the latest results.

The next board declaration will establish whether the $1.00 quarterly rate remains in place. Avery Dennison maintained that rate for the September 2, 2026, ex-dividend date, following the initial June 3, 2026, payment at the higher level. Its subsequent dividend declaration confirmed continuation of the new rate.