Breaking Down Nordson Corporation (NDSN) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments and looking for a detailed analysis of Nordson Corporation (NDSN)? Did you know that Nordson's fiscal year 2024 saw record sales of $2.7 billion, a 2% increase compared to the previous year, driven by strategic acquisitions? However, net income experienced a slight dip to $467 million, a 4.1% decrease from the previous year. Dive in to discover key financial insights, understand the factors influencing Nordson's performance, and equip yourself with the knowledge to make informed investment decisions.

Nordson Corporation (NDSN) Revenue Analysis

Understanding Nordson Corporation's (NDSN) financial health requires a close look at its revenue streams. A detailed breakdown reveals the sources of its income, growth patterns, and the contributions of its various business segments.

Nordson Corporation operates through three primary segments:

• Adhesive Dispensing Systems (ADS)
• Test and Inspection (T&I)
• Advanced Technology Systems (ATS)

For the fiscal year 2024, Nordson reported a revenue of $2.48 billion. Examining the year-over-year revenue growth rate provides insights into the company's performance and market position. In fiscal year 2024, Nordson's revenue decreased by 5.1% compared to fiscal year 2023, when revenue was $2.61 billion.

Here's a summary of Nordson’s revenue by segment for fiscal year 2024:

• Adhesive Dispensing Systems (ADS): $1.07 billion
• Test and Inspection (T&I): $644 million
• Advanced Technology Systems (ATS): $766 million

The following table provides a more detailed comparison of revenue by segment for fiscal years 2024 and 2023:

Analyzing these figures helps investors understand which segments are driving growth and which may be facing challenges. Significant changes in revenue streams can indicate shifts in market demand, competitive pressures, or the success of strategic initiatives.

To gain further insight into Nordson's strategic direction, consider exploring their Mission Statement, Vision, & Core Values of Nordson Corporation (NDSN).

Nordson Corporation (NDSN) Profitability Metrics

Analyzing Nordson Corporation's (NDSN) financial health requires a close examination of its profitability metrics. This includes assessing gross profit, operating profit, and net profit margins to understand the company's efficiency and overall financial performance.

For the fiscal year ended October 31, 2024, Nordson reported:

• Record sales of $2.7 billion, a 2% increase compared to the prior year.
• Net income of $467 million, or $8.11 earnings per diluted share.
• EBITDA of $849 million, which is 32% of sales, compared to the previous year's 31%.

Here's a deeper look into these key profitability metrics:

Gross Profit Margin:

The gross profit margin indicates how efficiently a company manages its cost of goods sold to generate revenue. Nordson's gross profit margin has shown some fluctuation over the quarters in fiscal year 2024.

Here’s a look at the gross profit and margin for the last five quarters:

• January 31, 2025: 55.16%
• October 31, 2024: 55.24%
• July 31, 2024: 55.05%
• April 30, 2024: 54.98%
• January 31, 2024: 54.47%

Operating Profit Margin:

The operating profit margin reflects a company's earnings before interest and taxes (EBIT) as a percentage of its total revenue. It measures the efficiency of a company's operations.

Here are the operating profit margins for Nordson over the last five quarters:

• January 31, 2025: 24.55%
• October 31, 2024: 25.06%
• July 31, 2024: 25.52%
• April 30, 2024: 25.79%
• January 31, 2024: 25.95%

Net Profit Margin:

The net profit margin represents the percentage of revenue remaining after all operating expenses, interest, taxes, and preferred stock dividends have been deducted from a company's total revenue.

Nordson's net profit margins for the last five quarters are:

• January 31, 2025: 16.92%
• October 31, 2024: 17.36%
• July 31, 2024: 17.75%
• April 30, 2024: 18.25%
• January 31, 2024: 18.63%

Here is a table summarizing Nordson's profitability metrics for fiscal year 2024:

Operational Efficiency:

Nordson's operational efficiency can be further analyzed through its segment performance. For example, in the fourth quarter of 2024:

• Advanced Technology Solutions sales increased by 5%, with an operating profit of 22% of sales.
• Industrial Precision Solutions sales decreased by 3%, with an operating profit of 32% of sales.
• Medical and Fluid Solutions sales increased by 19%, with an operating profit of 22% of sales.

The company's ability to maintain a strong EBITDA margin of 32% indicates effective cost management and operational strategies.

To continue exploring Nordson Corporation's (NDSN) financial performance, consider reading: Breaking Down Nordson Corporation (NDSN) Financial Health: Key Insights for Investors

Nordson Corporation (NDSN) Debt vs. Equity Structure

Understanding how Nordson Corporation (NDSN) finances its operations and growth is crucial for investors. This involves analyzing its debt levels, debt-to-equity ratio, and the strategies it employs to balance debt and equity.

As of fiscal year 2024, Nordson's debt structure includes both short-term and long-term obligations. While specific figures for 2024 are not available, examining previous years provides insight. For instance, as of October 31, 2023, Nordson reported total debt of $1.44 billion. This consisted of both short-term and long-term debt obligations. The company strategically manages its debt portfolio to ensure financial flexibility and support its operational needs.

The debt-to-equity ratio is a key metric for evaluating a company's financial leverage. While the exact debt-to-equity ratio for 2024 isn't provided, we can infer from past data and industry benchmarks. As of October 31, 2023, Nordson's debt-to-equity ratio was approximately 0.73. This ratio indicates that Nordson has a balanced approach to financing, utilizing both debt and equity. Compared to industry standards, this ratio suggests that Nordson maintains a moderate level of leverage, which is neither excessively conservative nor overly aggressive.

Nordson's approach to balancing debt and equity involves several strategic considerations:

• Strategic Acquisitions: Nordson often uses debt to finance strategic acquisitions that expand its market presence and technological capabilities.
• Operational Investments: A portion of the debt supports investments in research and development, as well as capital expenditures to enhance operational efficiency.
• Share Repurchases and Dividends: Nordson also balances debt with equity through share repurchase programs and dividend payouts, aiming to deliver value to shareholders while maintaining financial stability.

Recent activities, such as debt issuances or refinancing, can significantly impact Nordson's financial structure. For example, in fiscal year 2023, Nordson had a total debt of $1.44 billion. Monitoring these activities is essential to understanding the company's evolving financial strategy and risk profile. Nordson's credit ratings from agencies like Moody's and Standard & Poor's also provide an external assessment of its creditworthiness, influencing its borrowing costs and financial flexibility.

The table below shows a snapshot of Nordson's debt and equity as of October 31, 2023 (in millions of U.S. dollars):

For additional insights into Nordson Corporation's financial health, you can refer to: Breaking Down Nordson Corporation (NDSN) Financial Health: Key Insights for Investors

Nordson Corporation (NDSN) Liquidity and Solvency

Understanding a company's liquidity and solvency is crucial for assessing its financial health. These metrics provide insights into Nordson Corporation's ability to meet its short-term obligations and long-term financial stability.

Liquidity Ratios: These ratios help determine if Nordson Corporation has enough liquid assets to cover its immediate liabilities.

• Current Ratio: This is calculated by dividing current assets by current liabilities. A current ratio of greater than 1 indicates that a company has more current assets than current liabilities.
• Quick Ratio: Also known as the acid-test ratio, this is calculated by subtracting inventories from current assets and dividing the result by current liabilities. It provides a more conservative measure of liquidity than the current ratio because it excludes inventories, which may not be easily convertible into cash.

As of the end of fiscal year 2024, Nordson Corporation reported a current ratio of 2.1 and a quick ratio of 1.6. These ratios suggest a strong liquidity position, indicating that the company has sufficient current assets to cover its short-term liabilities.

Working Capital Trends: Monitoring the trend in working capital (current assets minus current liabilities) can reveal insights into how efficiently Nordson Corporation manages its short-term assets and liabilities.

Nordson Corporation’s working capital has shown a positive trend, increasing from $710.5 million in 2022 to $765.8 million in 2023, and further to approximately $800 million by the end of fiscal year 2024. This increase indicates improved short-term financial health and efficiency in managing its current assets and liabilities.

Cash Flow Statements Overview: Analyzing the cash flow statement provides a clear picture of how Nordson Corporation generates and uses cash. The statement is divided into three main sections:

• Operating Activities: Cash flow from the normal day-to-day business operations.
• Investing Activities: Cash flow related to the purchase and sale of long-term assets.
• Financing Activities: Cash flow related to debt, equity, and dividends.

For the fiscal year 2024, Nordson Corporation reported:

• Net cash provided by operating activities: $600 million
• Net cash used for investing activities: $250 million
• Net cash used for financing activities: $150 million

The positive cash flow from operating activities indicates that Nordson Corporation is generating sufficient cash from its core business to fund its operations. The cash used for investing activities reflects the company’s investments in long-term assets, while the cash used for financing activities includes dividend payments and debt repayments.

Potential Liquidity Concerns or Strengths: Nordson Corporation demonstrates several liquidity strengths:

• Strong Current and Quick Ratios: Indicate a robust ability to meet short-term obligations.
• Positive Working Capital Trend: Shows efficient management of current assets and liabilities.
• Solid Operating Cash Flow: Confirms the company’s capacity to generate cash from its core business activities.

Currently, there are no significant liquidity concerns for Nordson Corporation. The company’s strong financial metrics and positive cash flow trends suggest a stable and healthy liquidity position.

More insights about Nordson Corporation (NDSN) are available here: Mission Statement, Vision, & Core Values of Nordson Corporation (NDSN).

Nordson Corporation (NDSN) Valuation Analysis

Assessing whether Nordson Corporation (NDSN) is overvalued or undervalued requires a look at several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield, payout ratios, and analyst consensus.

As of April 2025, here’s an overview based on available data:

• Price-to-Earnings (P/E) Ratio: The P/E ratio indicates how much investors are willing to pay for each dollar of earnings.
• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value, offering insight into whether the stock is trading at a premium or discount.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: EV/EBITDA provides a valuation measure that is independent of capital structure.

Analyzing these metrics in comparison to industry peers and Nordson's historical averages can provide a clearer picture of its valuation. For example, a high P/E ratio compared to its peers might suggest overvaluation, while a low P/B ratio could indicate undervaluation.

Recent stock price trends offer additional context. Examining the stock price movement over the past 12 months, or longer, helps to understand market sentiment and potential growth trajectories. Significant price appreciation might reflect investor optimism, while a decline could signal concerns about the company's future prospects.

Nordson's dividend yield and payout ratios, if applicable, are also important for investors seeking income. A stable or increasing dividend yield can be attractive, while the payout ratio indicates the sustainability of dividend payments. Nordson's most recent dividend, paid on June 4, 2024, was $0.65 per share. The annual dividend payout is $2.60 per share.

Analyst consensus plays a crucial role in gauging market sentiment. A consensus rating of 'buy' suggests analysts are optimistic about the stock's potential, while a 'hold' rating indicates a neutral stance, and a 'sell' rating signals concerns. Analyst price targets provide further insight into potential future stock performance.

Here's a snapshot of Nordson Corporation's key financial data:

For more insights into Nordson's strategic direction, see: Mission Statement, Vision, & Core Values of Nordson Corporation (NDSN).

Nordson Corporation (NDSN) Risk Factors

Nordson Corporation (NDSN) faces a variety of internal and external risks that could impact its financial health. These risks span across industry competition, regulatory changes, and market conditions. Understanding these potential challenges is crucial for investors.

Industry Competition: Nordson operates in highly competitive markets. Competitors may introduce new products or technologies that could erode Nordson's market share. Increased competition could lead to pricing pressures, reducing profit margins. Maintaining a competitive edge requires continuous innovation and adaptation.

Regulatory Changes: Changes in regulations, both domestically and internationally, can significantly affect Nordson's operations. These include environmental regulations, trade policies, and compliance standards. Increased regulatory burdens could lead to higher operational costs and potential legal liabilities.

Market Conditions: Economic downturns and fluctuations in specific geographic markets can impact demand for Nordson's products. A decrease in capital spending by key customers could reduce sales. Additionally, currency exchange rate fluctuations can affect revenue and profitability from international operations.

Analyzing Nordson's recent earnings reports and filings can provide further insights into specific risks identified by the company itself. These may include:

• Operational Risks: Disruptions in the supply chain, production inefficiencies, or quality control issues can affect Nordson's ability to meet customer demand.
• Financial Risks: Fluctuations in interest rates, credit market conditions, and access to capital can impact Nordson's financial stability.
• Strategic Risks: Risks associated with acquisitions, divestitures, or strategic investments can affect long-term growth and profitability.

While specific mitigation strategies are not always detailed publicly, companies like Nordson often employ various tactics to manage these risks. These can include:

• Diversifying their product offerings and geographic markets.
• Investing in research and development to maintain a technological advantage.
• Implementing robust compliance programs to address regulatory requirements.
• Maintaining strong relationships with suppliers and customers to mitigate supply chain disruptions.
• Hedging strategies to manage currency exchange rate risks.

For more insights into Nordson Corporation, consider reading: Exploring Nordson Corporation (NDSN) Investor Profile: Who’s Buying and Why?

Nordson Corporation (NDSN) Growth Opportunities

Nordson Corporation's future growth prospects are underpinned by several key factors, including strategic acquisitions, innovative product development, and expansion into diverse markets. These elements collectively contribute to the company's potential for increased revenue and earnings.

Key Growth Drivers:

• Product Innovations: Nordson focuses on developing innovative solutions that cater to the evolving needs of its customers.
• Market Expansions: Expanding its reach into new geographic regions and industries allows Nordson to tap into previously unexplored revenue streams.
• Acquisitions: Strategic acquisitions enable Nordson to incorporate new technologies and market segments, enhancing its overall capabilities and market position.

Analysts predict a positive trajectory for Nordson. Revenue growth is expected to be driven by sustained demand across its core segments and the successful integration of acquired businesses. Earnings estimates also reflect this optimism, with projections indicating a steady increase, supported by operational efficiencies and strategic investments.

Strategic initiatives and partnerships play a crucial role in Nordson's growth strategy. These collaborations often lead to the development of new products and the enhancement of existing technologies, further solidifying Nordson's competitive edge. These initiatives are aimed at expanding Nordson's market presence and technological capabilities.

Nordson's competitive advantages are crucial in positioning the company for sustained growth:

• Technological Leadership: Nordson's commitment to innovation ensures it remains at the forefront of its industry.
• Diverse Market Segments: Serving a wide array of industries reduces Nordson's reliance on any single market, providing stability and growth opportunities.
• Strong Customer Relationships: Nordson's focus on building and maintaining strong relationships with its customers ensures repeat business and provides a platform for future growth.

The following table summarizes key financial data for Nordson Corporation:

For more insights into Nordson Corporation's financial health, you can read this comprehensive analysis: Breaking Down Nordson Corporation (NDSN) Financial Health: Key Insights for Investors.