Avery Dennison arrives at its Thursday earnings release with the most striking development now in options markets — where sentiment has undergone a dramatic reversal in the week leading into the print.
The options signal is the standout. The put/call ratio collapsed to 0.73 on July 24, nearly 1.7 standard deviations below its 20-day average of 3.59. That average itself reflects several weeks of heavy put-buying — the PCR ran above 4.0 from early July all the way through July 17 before abruptly unwinding. The shift suggests options traders rotated sharply from hedging to positioning for upside over the past few sessions. The 52-week PCR range runs from 0.12 to 11.85, so the current reading sits near the bullish extreme of recent history. That's a meaningful change from the cautious posture visible in the prior earnings preview published July 19.
Short interest tells a calmer story. At roughly 3.3% of the free float, it remains modest. The share count has drifted about 15% higher over the past month, but the absolute level is not aggressive. The borrow market is loose — availability runs at approximately 2,700% of short interest, meaning shares to borrow are plentiful — and the cost to borrow is a negligible 0.44%, down slightly on the week. There is no squeeze pressure, and no sign of a forced-exit dynamic in the lending market.
The analyst picture is unchanged from last week's note: BofA holds its Buy with a $210 target; Truist maintains Buy but trimmed to $209 from $221; Citigroup sits at Neutral with a $184 target, 15% below the current price of $160.90. The consensus mean of $199.60 implies roughly 24% upside. Bulls focus on the RFID-driven Solutions segment expansion, logistics and food sales growth running near 15%, and the CVS partnership delivering double-digit gains. Bears point to the downward revision to near-term EPS and continued headwinds in apparel volumes. The stock's forward EPS growth trajectory ranks in the 86th percentile of the universe, but momentum remains the weak link — price-wise, the stock is only 2% above where it was a month ago, having recovered 3.7% in Thursday's session. Peers were broadly firm on Friday, with AMCR up 4.5% and GEF up 2.4%.
Thursday's print will test whether the abrupt shift from put-heavy to call-heavy positioning in options was prescient — or whether the near-term EPS revisions and apparel-volume drag that the bears have flagged reassert themselves against the RFID growth narrative.
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