Up to date on July 22th, 2025 by Felix Martinez
Nordson Company (NDSN) has a dividend monitor report that few firms can rival. The corporate has elevated its dividend for 61 consecutive years, rating it among the many longest dividend progress streaks in your complete market.
That places Nordson among the many elite Dividend Kings, a small group of shares which have elevated their payouts for not less than 50 consecutive years. You may see the whole listing of all 55 Dividend Kings right here.
Moreover, we created an inventory of all of the Dividend Kings together with essential monetary metrics equivalent to P/E ratios and present dividend yields. You may entry your copy of the Dividend Kings sheet by clicking on the hyperlink under:
Dividend Kings have the longest monitor data on the subject of rewarding shareholders with money, and Nordson isn’t any completely different.
Nordson doesn’t have a family identify and might not be well-known amongst buyers. Nonetheless, the corporate has an extended and profitable historical past of accelerating its dividend.
Nordson has been a high-growth firm for a few years. On this article, we’ll study the enterprise and its prospects for funding.
Enterprise Overview
Nordson was based in 1954 in Amherst, Ohio; nonetheless, the corporate can hint its roots again to 1909 because the U.S. Automated Firm. That enterprise specialised in making screw machine elements for the fledgling automotive business, however within the Nineteen Thirties, the corporate shifted to producing extra high-precision elements, which you’d in all probability affiliate with the Nordson of as we speak.
Then, in 1954, Nordson was established as a division of the U.S. Automated Firm via the acquisition of patents protecting the “scorching airless” methodology of spraying paint and different coating supplies. The remainder, as they are saying, is historical past, as Nordson has grown to roughly $2.7 billion in annual income and trades with a market capitalization of simply over $12.1 billion.
Nordson engineers, manufactures, and markets distinctive merchandise used to dispense, apply, and management adhesives, sealants, polymers, coatings, and different fluids, in addition to to check for high quality and deal with and treatment surfaces.
The corporate’s merchandise are discovered everywhere in the world, bought primarily by a direct, world gross sales drive, and provide customized options to their prospects’ engineering issues. Nordson has established a popularity over the previous 5 a long time for delivering high quality and worth via its numerous vary of options.
The corporate has a extremely numerous buyer base:
Supply: Investor Presentation
Nordson is split into three enterprise segments: Industrial Precision Options, Medical and Fluid Options, and Superior Know-how Options. The primary phase contains adhesives, coatings, paints, finishes, and sealants.
The Medical and Fluid Options phase incorporates merchandise equivalent to plastic tubing, balloons, catheters, fluid connection parts, and syringes. The Superior Know-how Options phase contains digital processing methods.
Nordson’s income combine is very diversified, with roughly 44% of its income coming from the U.S. The rest is from all kinds of world prospects, providing Nordson not solely a various buyer base but in addition variety by way of currencies. We be aware that this opens the corporate’s outcomes as much as forex volatility, which the markets have skilled in recent times.
The U.S. is Nordson’s largest market by way of geographic presence, however the Asia-Pacific and European markets aren’t far behind. Nordson is a very world firm.
Supply: Investor Presentation
By way of product kind, Nordson generates about 53% of its gross sales from industrial precision options, which is a comparatively engaging space of focus as a result of an ideal portion of this income is recurring in nature. Individually, Nordson generates the stability of its gross sales from medical fluid options and superior expertise options.
Progress Prospects
Between 2010 and 2019, Nordson greater than doubled its income and grew its earnings per share at a median annual charge of 11.3%. The corporate stumbled in 2020, with a 7% decline in earnings per share. Administration attributed the lackluster efficiency to the difficult world financial surroundings amid the coronavirus pandemic.
Nonetheless, the corporate remained extremely worthwhile even through the worst of the pandemic, and solely skilled a gentle decline in earnings per share in 2020. Nordson returned to progress in 2021, with a formidable 41% enhance in earnings per share. The corporate adopted this up with a 22% enchancment in 2022.
Nordson Company reported fiscal Q2 2025 gross sales of $683 million, a 5% enhance from $651 million in Q2 2024, pushed by an 8% acquisition influence, primarily from the Atrion acquisition, offset by a 2% decline in natural gross sales and a lower than 1% unfavorable forex translation. Internet earnings was $112 million, or $1.97 per diluted share, in comparison with $118 million, or $2.05 per share, in Q2 2024, whereas adjusted web earnings rose to $138 million, with adjusted EPS up 3% to $2.42 from $2.34. EBITDA elevated 7% to $217 million, or 32% of gross sales, from $203 million, or 31% of gross sales, reflecting operational excellence regardless of geopolitical uncertainties. The corporate forecasted Q3 2025 gross sales of $710–$750 million and adjusted EPS of $2.55–$2.75, supported by a 5% progress in backlog.
Phase efficiency diversified: Industrial Precision Options gross sales fell 8% to $319 million because of a 7% natural decline in polymer processing and industrial coatings, with EBITDA at $114 million (36% of gross sales). Medical and Fluid Options gross sales elevated 20% to $203 million, pushed by a 30% acquisition influence, though natural gross sales declined 10% because of program rationalization and destocking, with EBITDA at $77 million (38% of gross sales). Superior Know-how Options’ gross sales rose 18% organically to $161 million, fueled by semiconductor and electronics demand, with EBITDA at $40 million (25% of gross sales). Nordson’s decentralized mannequin and in-region manufacturing supported robust order entry and profitability.
The corporate maintained a sturdy stability sheet, with money and money equivalents at $130.2 million and complete belongings of $6.06 billion as of April 30, 2025. Working money circulation for the primary six months was $278.3 million, with $146.3 million used for share repurchases, together with $85 million in Q2, and $88.9 million for dividends. Nordson’s strategic give attention to differentiated merchandise and acquisitions, coupled with value optimization, positions it for sustained progress. The corporate’s potential to ship robust margins amid market challenges underscores its resilience and dedication to long-term shareholder worth.
We imagine that Nordson’s long-term progress prospects ought to stay intact. There are a lot of levers for Nordson’s long-term progress. Nordson is a serial acquirer and has been mainly from the start, when it was began with the acquisition of patents protecting the recent airless methodology of spraying.
Nordson’s monitor report with acquisitions is robust, as the corporate seeks takeover targets that present a aggressive benefit it doesn’t already possess, characterised by excessive percentages of recurring income and value synergies.
Progress by acquisition is a difficult endeavor for long-term success; nonetheless, Nordson has persistently demonstrated its potential to realize this over the long run. It is a key differentiator for Nordson and shouldn’t be ignored by buyers. Nordson has generated robust progress for a few years, pushed by each inside initiatives and acquisitions.
Supply: Investor Presentation
The mixture of acquisitions, natural progress, and a give attention to steady enchancment drives not solely top-line enlargement but in addition margin features. The continuous introduction of latest merchandise and applied sciences drives natural income progress. This regular stream of latest concepts evolves into new merchandise, driving natural income progress.
Moreover, Nordson’s give attention to rising markets has been a major progress driver and can proceed to contribute to future progress. The corporate’s rising markets have produced low double-digit income progress on common over the previous decade, outpacing Nordson’s core markets, the U.S. and Europe.
The rising center lessons in these rising markets ought to allow Nordson to proceed experiencing spectacular charges of natural income progress, in addition to opening up alternatives for continued, focused acquisitions in these markets.
Nordson has additionally been within the means of enhancing its effectivity via what it calls the Nordson Enterprise System. That is basically a set of instruments and greatest practices that Nordson has collected through the years, rooted in Lean Six Sigma ideas and utilized all through the corporate in all enterprise models. Nordson carefully screens and measures outcomes towards benchmarks, and this give attention to effectivity is a progress driver, driving margins.
Nordson has managed to develop its EBITDA margin in tandem with its income over the past 5 years, and the corporate expects continued progress and margin enlargement via 2025.
Supply: Investor Presentation
Because of all of the above progress drivers, we anticipate Nordson to develop its earnings per share at a ten.0% common annual charge over the subsequent 5 years.
Aggressive Benefits & Recession Efficiency
Nordson enjoys varied aggressive benefits, which paint a fairly rosy image of the corporate’s place. First, Nordson has a formidable world infrastructure that places it ready to not solely have a various buyer base, but in addition numerous teams of expertise.
As well as, its amenities are the place its prospects are on this planet (direct presence in 35 nations), and therefore Nordson can react extra shortly to product wants. This additionally affords Nordson a bonus when service is required, because it has folks close to its prospects wherever they’re. That is the form of factor that drives long-term relationships, that are Nordson’s bread and butter.
That brings us to our subsequent level, which is Nordson’s R&D and patents. Nordson solely spends about 3% of its income on R&D, however it makes probably the most of it, submitting for dozens of patents every year. Moreover, it acquires patents and companies that produce crucial merchandise, which it might use to complement its present traces.
Furthermore, Nordson’s in depth put in buyer base signifies that not solely does it generate a considerable quantity of recurring income, however it is usually far more difficult for rivals to draw prospects away. Switching prices are excessive for the kinds of merchandise Nordson sells, and thus, the incumbent in any given area has a major benefit. Nordson’s put in base affords quite a few advantages and is a main motive why the corporate has remained profitable for many years.
Nordson’s many aggressive benefits enable it to carry up fairly properly in recessionary environments; the corporate’s earnings per share throughout and after the Nice Recession are under:
- 2007 earnings-per-share of $1.33
- 2008 earnings-per-share of $1.77 (enhance of 33%)
- 2009 earnings-per-share of $1.20 (lower of 32%)
- 2010 earnings-per-share of $2.24 (enhance of 87%)
Earnings have been risky through the recession, however general, Nordson carried out very properly. There aren’t many firms with EPS figures that resemble this one throughout and after the Nice Recession, significantly people who manufacture for a residing.
Remember the fact that many merchandise of Nordson require capital bills from its prospects, whose budgets are usually slashed throughout recessions.
Nonetheless, Nordson additionally sells merchandise which might be important to many companies, and thus, when the mud settles, these orders are inclined to materialize. Certainly, Nordson’s recession-resistance is surprisingly good.
We noticed the corporate’s resilience to weak financial situations through the pandemic-impacted interval of 2020 and 2021 as soon as once more. Amongst industrial firms specifically, Nordson is kind of resilient to weak financial situations.
Valuation & Anticipated Returns
We anticipate Nordson to generate earnings per share of $10.02 this yr. Because of this, the inventory is buying and selling at a ahead price-to-earnings ratio of 21.4.
We take into account a price-to-earnings ratio of 24 to be truthful for Nordson. With shares decrease than our truthful PE, we see an annualized tailwind of two.5% from the valuation.
We additionally anticipate 10.0% annual EPS progress over the subsequent 5 years, whereas the inventory affords a dividend yield of 1.5%. Each of this stuff will add positively to shareholder returns. Nonetheless, with the yield and valuation headwind largely offsetting one another, we see 14% common complete annual returns over the subsequent 5 years.
Nordson’s robust free money circulation and disciplined strategy to acquisitions be certain that the dividend is well-covered. It additionally occurs to develop shortly. Nordson has raised its dividend yearly for 61 years.
The corporate has grown its dividend by 14.0% per yr on common over the past decade and by 14.5% per yr on common within the earlier 5 years. Due to this fact, aggressive dividend progress is at all times attainable for the corporate. General, Nordson’s dividend progress streak is excellent.
A low payout ratio helps the corporate develop its dividend. With a projected payout ratio of 31% this yr, the dividend is well-covered, with ample room for future raises.
Nordson’s strategy to spending its money is considerably completely different from that of different firms, as it might fluctuate from yr to yr, probably involving inventory buybacks, acquisitions, debt reimbursement, or different actions.
Since 2012, Nordson has allotted its money in numerous methods from one yr to the subsequent, together with greater than half of it over this era on acquisitions. There have been years of excessive ranges of buybacks, and years with none.
General, Nordson’s outcomes might be uneven, however the firm has achieved great success in producing long-term progress.
Ultimate Ideas
Nordson is a high-quality enterprise with a formidable streak of dividend progress. Nordson isn’t a robust inventory for prime earnings. That is considerably stunning, on condition that it’s a very uncommon Dividend King; nonetheless, the low payout ratio suggests {that a} beneficiant dividend just isn’t a precedence for administration.
The precedence is rising the enterprise, and this firm has carried out that exceedingly properly, producing sector-leading complete returns for shareholders. The dividend is anticipated to rise for a lot of extra years, as Nordson has persistently demonstrated over the previous 61 years its intention to proceed doing so for the foreseeable future.
We presently view Nordson as a purchase, given its anticipated annual complete returns of 14%.
The next databases of shares include firms with very lengthy dividend or company histories, making them ripe for choice by dividend progress buyers.
Further Studying
The next databases of shares include shares with very lengthy dividend or company histories, ripe for choice for dividend progress buyers.
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