Updated 3/11/2025
Nordson Corporation isn’t a household name, but in the industrial world, it’s a respected player. The company specializes in precision dispensing equipment, fluid management, and surface treatment technologies, supporting a wide range of industries—from packaging and electronics to medical devices.
It’s not the flashiest stock, and it doesn’t make headlines often, but what Nordson does offer is consistency. It has built a long track record of profitability and has rewarded its investors with reliable dividend growth year after year. While the stock has seen some volatility lately, dipping more than 3% in the last trading session, the fundamentals behind the company remain solid. With a market cap of $11.72 billion and a dividend yield of 1.51%, Nordson fits the mold of a dependable, long-term dividend payer.
Key Dividend Metrics
📈 Forward Dividend Yield: 1.51%
💰 Annual Dividend Rate: $3.12
📅 Next Dividend Date: April 3, 2025
⚠️ Ex-Dividend Date: March 20, 2025
📊 5-Year Average Yield: 0.96%
🎯 Payout Ratio: 37.15%
🚀 Dividend Growth Streak: Over 60 years
Dividend Overview
For investors looking for a stock with a reliable dividend, Nordson delivers. The yield sits at 1.51%, which may not seem high at first glance, but it’s backed by strong fundamentals. The real highlight is the company’s incredible streak of dividend increases, now surpassing six decades. That kind of consistency isn’t easy to find, even among dividend-focused companies.
The payout ratio of 37.15% is another strong point. It means the company isn’t overextending itself to pay dividends, leaving plenty of room for reinvestment and future increases. While some industrial companies offer higher yields, they often come with more risk. Nordson, on the other hand, takes a slow-and-steady approach, which has proven to be sustainable over time.
Dividend Growth and Safety
Nordson’s dividend isn’t just stable—it’s growing. Over the past five years, the stock’s average dividend yield has been 0.96%, meaning today’s 1.51% is on the higher side relative to historical levels. That suggests investors may be getting a better yield now than in recent years.
Dividend growth looks secure, thanks to the company’s strong cash flow generation. With $359.54 million in free cash flow, Nordson can comfortably cover its dividend obligations while still reinvesting in operations.
Debt is a factor to watch, as the company carries $2.3 billion in total debt. However, it’s well-managed, and the current ratio of 2.53 suggests no immediate liquidity concerns. For dividend investors, the key takeaway is that the dividend remains well-funded and unlikely to face pressure anytime soon.
Chart Analysis
Nordson’s stock chart shows a clear downtrend over the past several months, with the price consistently moving lower. The stock is currently trading at 206.01, which is well below both the 50-day and 200-day moving averages. This indicates that the broader trend remains bearish, and there hasn’t been a strong attempt at a reversal just yet.
Moving Averages
The 50-day moving average (light blue line) is trending downward and remains below the 200-day moving average (dark blue line). This bearish crossover suggests that momentum has been negative for some time. Typically, when the shorter-term moving average is below the longer-term one, it confirms that sellers are in control.
While there have been some short-term bounces along the way, none have been strong enough to push the stock back above these key levels. Until the stock can reclaim at least the 50-day moving average, upside potential remains limited.
Volume Trends
Volume has fluctuated, but there are noticeable spikes on large red days, which suggests strong selling pressure at key moments. When a stock moves down on higher-than-average volume, it often signals that institutional investors are offloading shares.
There was a significant volume spike in late December, followed by another notable increase more recently. These spikes in activity often happen around inflection points, where the market decides whether the trend will continue or reverse. So far, the volume profile isn’t showing clear signs of buyers stepping in aggressively.
Relative Strength Index (RSI)
The RSI, located at the bottom of the chart, has been hovering in the lower range for a while. It hasn’t quite reached extreme oversold levels, but it remains weak. Typically, when the RSI drops below 30, it suggests that a stock is oversold and due for a rebound. Right now, it’s still in bearish territory, which aligns with the overall trend of the stock.
Recent Price Action
Looking at the last five candles, there’s a pattern of lower highs and lower lows, reinforcing the bearish sentiment. The most recent candle shows a slight rebound attempt, but the long upper wick suggests that sellers quickly stepped in to push the price back down. This type of price action often indicates a lack of strong buying interest.
The stock attempted to break higher but was rejected near the 213 level, reinforcing the idea that resistance remains strong overhead. The lower wick on the most recent candles suggests some buyers are stepping in, but not with enough conviction to change the trend just yet.
Key Levels to Watch
The most immediate support level is around 200, which has acted as a floor in recent months. If the stock breaks below that, the next major support could be in the 190-195 range. On the upside, resistance sits near 215, followed by a bigger test at the 50-day moving average around 225.
If Nordson can push back above its 50-day moving average with strong volume, it would be an early sign that the stock is attempting to stabilize. Until then, the trend remains under pressure, and the stock will need stronger buying momentum to change direction.
Analyst Ratings
📊 Nordson Corporation has recently experienced a mix of analyst upgrades and downgrades, reflecting varied perspectives on its performance and prospects.
🟢 Upgrades
📈 Loop Capital upgraded Nordson from hold to strong buy on January 22, 2025, raising the price target from $255 to $280. This upgrade was based on the firm’s recognition of Nordson’s strong market position and potential for revenue growth in key industrial sectors. Analysts cited increasing demand in automation and adhesive dispensing markets as a key driver.
🚀 Seaport Global also upgraded Nordson to strong buy from hold on December 17, 2024, setting a price target of $250. The firm highlighted Nordson’s consistent financial performance, efficient cost management, and strategic acquisitions that could drive long-term profitability.
🔴 Downgrades
📉 Baird downgraded Nordson from buy to hold on December 13, 2024, adjusting the price target from $294 to $237. The downgrade was attributed to concerns over valuation, as the stock had been trading at a premium compared to historical averages. Analysts also noted potential headwinds in demand for industrial coatings and adhesives.
⚠️ KeyBanc shifted its rating from buy to hold on February 26, 2024, removing its previous price target. Analysts expressed caution due to valuation concerns and uncertainties in the electronics sector, which could impact Nordson’s near-term revenue growth.
🎯 Consensus Price Target
💰 The consensus among analysts is a price target of approximately $258.83, suggesting a potential upside of around 19.47% from the current stock price.
These mixed analyst opinions reflect a balance of optimism and caution. While Nordson’s strong fundamentals and market leadership continue to attract bullish sentiment, valuation and cyclical risks remain areas of concern for some firms.
Earnings Report Summary
Nordson Corporation’s latest earnings report showed a bit of a mixed bag, with both challenges and bright spots. The company brought in $615 million in revenue for the first quarter of fiscal 2025, which was down about 2.8% from the same time last year. A drop in organic sales and some unfavorable currency impacts were the main culprits, but recent acquisitions helped soften the blow.
Net income for the quarter came in at $95 million, translating to earnings per share of $1.65. That’s a dip from last year’s $1.90 per share, but when adjusted for certain one-time costs, earnings per share landed at $2.06, down about 7% from the previous $2.21. The company’s EBITDA was $188 million, holding a 31% margin, slightly lower than last year’s $197 million.
How the Business Segments Performed
- Industrial Precision Solutions had a tougher quarter, with sales falling 11% to $300 million. Demand for polymer processing and industrial coatings weakened, though adhesive product lines helped cushion the decline. Operating profit for this segment dropped by $13 million to $96 million, while EBITDA sat at $113 million, representing 38% of sales.
- Medical and Fluid Solutions was a standout, growing 21% to $194 million, thanks to recent acquisitions. However, organic sales still fell 11% as medical customers slowed orders to reduce inventory. Operating profit declined by $5 million to $41 million, with an EBITDA of $64 million, making up 33% of sales.
- Advanced Technology Solutions struggled with an 11% sales drop to $121 million, mainly due to weaker demand for electronics processing and x-ray systems. On the bright side, optical sensors and measurement and control products saw some growth. Despite the revenue decline, operating profit held steady at $18 million, and EBITDA was $23 million, making up 19% of sales.
One encouraging sign was the company’s backlog, which grew by about $85 million, up 15% from the previous quarter. That suggests demand could pick up in the coming months.
Looking ahead, Nordson expects sales for the next quarter to land somewhere between $650 million and $690 million, with adjusted earnings per share projected between $2.30 and $2.50. While some challenges remain, management seems cautiously optimistic about what’s ahead.
Financial Health and Stability
Even as the stock price has come under pressure, Nordson continues to post solid financial results.
- Profit margin sits at 16.93%, a healthy figure for an industrial company.
- Operating margin is 23.07%, showing strong operational efficiency.
- Return on equity (ROE) stands at 16.15%, a sign that management is putting shareholder capital to good use.
- Return on assets (ROA) comes in at 7.44%, indicating the company is effectively using its resources.
One area of concern is revenue growth. Nordson’s revenue declined by 2.8% year-over-year, which isn’t ideal, but the company has a history of navigating economic slowdowns effectively. As long as margins stay strong, minor dips in revenue aren’t a major red flag for long-term investors.
The company’s debt-to-equity ratio is at 79.79%, meaning it does use leverage, but not to an extreme degree. Given its strong cash flow, Nordson has the ability to manage its debt without compromising its dividend strategy.
Valuation and Stock Performance
Looking at valuation, Nordson isn’t exactly cheap, but it’s not outrageously priced either.
- Trailing P/E ratio is 26.21, while the forward P/E is 20.70, suggesting the stock may be slightly more attractive based on future earnings.
- Price-to-sales ratio is 4.44, which is on the higher side for an industrial stock.
- Price-to-book ratio sits at 4.08, which is reasonable but not a bargain.
- PEG ratio of 1.71 indicates that growth expectations are still intact.
The stock has dropped over 22% from its 52-week high of $279.38, currently trading around $206. That decline brings up an interesting point—while the stock has underperformed in recent months, for long-term dividend investors, this may be a more attractive entry point than in the past.
The 50-day moving average is $213.26, while the 200-day moving average is $236.46, signaling that the stock is currently in a short-term downtrend. However, for investors focused on dividends rather than short-term price movements, this could present a buying opportunity rather than a cause for concern.
Risks and Considerations
Every stock comes with risks, and Nordson is no exception. Here are a few things to keep in mind:
- Revenue Decline – The -2.8% drop in revenue may not be a long-term issue, but it’s something to monitor. If industrial demand weakens further, it could impact earnings growth.
- Cyclicality – As an industrial company, Nordson’s performance is tied to economic cycles. If manufacturing demand slows, earnings could take a temporary hit.
- Debt Load – While manageable, $2.3 billion in debt is not a small number. Rising interest rates could make refinancing more expensive in the future.
- Stock Volatility – The stock has pulled back 22% from its highs, which may worry some investors. However, this could also be an opportunity for those with a long-term mindset.
Despite these risks, Nordson has weathered economic downturns before and has continued increasing its dividend through challenging times. That speaks to the strength of its business model.
Final Thoughts
Nordson Corporation may not be a high-yield stock, but it’s one of the most reliable dividend payers out there. The company’s track record of 60+ years of consecutive dividend increases is impressive, and with a payout ratio of just 37.15%, there’s still room for future growth.
While the yield sits at 1.51%, it’s well-supported by cash flow, and Nordson has proven its commitment to rewarding shareholders over the long run. The recent pullback in stock price could make this a more attractive entry point for patient investors.
The bottom line? Nordson is a steady performer that doesn’t grab headlines, but for those focused on dividend stability and growth, it’s a name worth keeping an eye on.
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