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  "docSlug": "09bbf36d82e5",
  "documentTitle": "Avery Dennison Corporation (AVY)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "presentationDate": "2020-11-10 00:00:00",
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  "pageNumber": 34,
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  "notes": "Uses a combination of expert quote, risk factor comparison, and a historical data table to build a case for declining R&D commitment.",
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      "text": "In its recent 2020 10-Q filings, it now ceases disclosures of R&D expenses, which we view as a major red flag.",
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      "text": "R&D Expense as % of Sales: 1.31%",
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      "text": "AVY does not disclose revenues from new products, and our understanding is that many competitors easily mimic its innovations in the core label business, which has few truly revolutionary development opportunities. As a result, we see that AVY consistently spends less and less revenue on R&D. In its recent 2020 10-Q filings, it now ceases disclosures of R&D expenses, which we view as a major red flag. It’s risk factors on R&D have also expanded.",
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      "text": "I’d be asking management how much of sales is being driven by new products? You’re investing all this money in R&D. Where is it in the portfolio from the perspective of growth, share gain, and profitability? And in sustainable products, none of that fetches a higher margin. It’s good for the world and the environment, but is it helping your margin; I don’t think so.",
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      "text": "“I’d be asking management how much of sales is being driven by new products? You’re investing all this money in R&D. Where is it in the portfolio from the perspective of growth, share gain, and profitability? And in sustainable products, none of that fetches a higher margin. It’s good for the world and the environment, but is it helping your margin; I don’t think so.” — Former Avery VP For 7 Years",
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      "text": "Source: Avery SEC Filings",
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      "text": "Table showing Net Sales, R&D Expense, and % of Sales from 2011 to 2019, with YTD 2020 marked as 'Stopped Disclosing'.",
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      "text": "Innovation Problem Culminating In Omission of R&D Expenditures",
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