Nordson Corporation Faces Challenges Amid Market Decline
Westlake, Ohio-based Nordson Corporation (NDSN) is a key player in manufacturing and selling products and systems for dispensing adhesives, coatings, polymers, and fluids on a global scale. With a market capitalization of $12.1 billion, Nordson is divided into three main segments: Industrial Precision Solutions, Medical and Fluid Solutions, and Advanced Technology Solutions.
As a large-cap stock, Nordson holds a respected position in the specialty industrial machinery sector, with its market cap signifying considerable size and influence within the industry.
Significant Stock Drop
In recent months, Nordson’s stock has seen a dramatic decline, falling approximately 23.7% from its all-time high of $279.38 reached on May 10. The company has dropped 18.3% over the last three months, notably lagging behind the Nasdaq Composite’s ($NASX) impressive 10.1% increase during the same period.
Long-term Struggles
The longer-term outlook for Nordson appears more discouraging. In the past six months, NDSN has decreased by 7.2%, and a significant 19.2% over the last 52 weeks, both underperforming NASX’s encouraging returns of 12.4% and 32.8%, respectively.
Confirming this downturn, Nordson shares have recently fallen well below their 50-day and 200-day moving averages.
Earnings Report Impacts Stock Price
Despite surpassing Wall Street’s expectations for both earnings and revenues, Nordson’s stock dropped 8.2% in the session following its Q4 results released on December 11. While the company’s organic sales met challenges, acquisitions and favorable currency exchange rates contributed to a 3.5% year-over-year increase in total sales, reaching $744.5 million, 1.5% above expectations. Nonetheless, income before taxes fell by 7.8% to $148.1 million, primarily due to a 12.5% rise in selling, general, and administrative expenses to $223.9 million. However, the adjusted earnings per share (EPS) of $2.78 exceeded analysts’ estimates by 7.3%.
Nordson’s guidance for full-year fiscal 2025 sales, ranging from $2.75 billion to $2.87 billion, and adjusted EPS forecast of $9.70 to $10.50 did not meet Wall Street’s predictions, raising concerns among investors.
Comparative Performance
In comparison to its peer, Ingersoll Rand Inc. (IR), which saw gains of 2.8% over the past six months and 19.2% over the last year, Nordson’s performance has fallen short. Among the eight analysts covering Nordson stock, the consensus rating stands at “Moderate Buy.” The average price target of $254.17 suggests a potential upside of 19.2% compared to current levels.
On the date of publication, Aditya Sarawgi did not hold positions in any of the securities mentioned in this article. All information and data provided herein are for informational purposes only. For further details, please refer to the Barchart Disclosure Policy here.
The views expressed in this article reflect those of the author and do not necessarily represent those of Nasdaq, Inc.
