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Here's Why You Should Consider Investing in Nordson (NDSN)

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Nordson Corporation (NDSN - Free Report) is well poised for growth courtesy of strength across its businesses, solid product portfolio, acquired assets, and a sound capital-deployment strategy.

The Zacks Rank #2 (Buy) company has a market capitalization of $14 billion. In the past three months, the stock has appreciated 8.5% against the industry’s decline of 1.5%.

Zacks Investment Research
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Let’s delve into the factors that make the company a smart investment choice at the moment.

Business Strength: Nordson has been benefiting from strong demand for its product lines, particularly test and inspection in the electronics end market and fluid management in medical and industrial end markets. Growth in demand for hot melt adhesive and industrial coatings product lines, along with strength in its packaging business serving consumer non-durable end market, is also likely to drive its performance. For fiscal 2021 (ending October 2021), it expects revenues to grow in the range of 11-12% on a year-over-year basis.

Acquisition Benefits: The company’s buyout of vivaMOS Ltd. (September 2020) has been strengthening its test and inspection capabilities. Its buyout of Fluortek, Inc. (June 2020) has also been enhancing its medical product lines. This apart, Nordson’s agreement to acquire NDC Technologies (inked in August 2021) is expected to help it in expanding its test and inspection platform. In the third quarter of fiscal 2021 (ended July 2021), acquired assets had a positive impact of 0.8% on its Advanced Technology Solutions segment’s sales.

Rewards to Shareholders: It is committed toward rewarding shareholders through share- repurchase programs and dividend payouts. In the first nine months of fiscal 2021, the company paid out dividends worth $68 million to shareholders and repurchased shares worth $46.8 million. Also, the company hiked the quarterly dividend rate by 31% to 51 cents in August 2021.

Estimate Revisions: In the past 30 days, the Zacks Consensus Estimate for fiscal 2021 earnings has moved up from $7.56 to $7.96 on six upward estimate revisions. The consensus estimate for fiscal 2022 (ending October 2022) earnings has increased from $8.42 to $9.00 on six upward estimate revisions.

Other Key Picks

Some other top-ranked stocks from the same space are Kadant Inc. (KAI - Free Report) , Dover Corporation (DOV - Free Report) and EnPro Industries, Inc. (NPO - Free Report) . While Kadant sports a Zacks Rank #1 (Strong Buy), Dover and EnPro Industries carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Kadant pulled off a trailing four-quarter earnings surprise of 22.26%, on average.

Dover pulled off a trailing four-quarter earnings surprise of 17.59%, on average.

EnPro Industries pulled off a trailing four-quarter earnings surprise of 80.64%, on average.

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