Strength in Advanced Technology Unit Drives Nordson: Can the Momentum Sustain?

Nordson Corporation NDSN is witnessing strong momentum in the Advanced Technology Solutions segment, organic sales from which increased 8% year over year in the first nine months of fiscal 2025 (ended July 31, 2025). Growing demand for electronic processing and optical sensors, and electronics dispensing product lines within the semiconductor and electronics end markets is supporting the segment’s performance. In the first nine months of fiscal 2025, the segment’s operating margin increased 360 basis points year over year due to solid organic sales growth, manufacturing footprint optimization and strategic cost reduction initiatives.

Nordson is witnessing several positive trends that hold promise for its long-term growth. This includes growing customer demand for the nonwovens, precision agriculture, packaging and consumer non-durable product lines. However, lower demand for its x-ray inspection systems and the measurement and control product line remains a woe for the Advanced Technology Solutions segment.

Driven by strength across most of its businesses and synergies from acquired assets, Nordson provided a bullish outlook for fiscal 2025 (ending October 2025). The company expects overall sales to be in the range of $2.75-$2.87 billion in the fiscal year, implying an increase of 4.5% at the midpoint on a year-over-year basis.

Segment Snapshot of NDSN’s Peers

Among its major peers, Graco Inc. GGG is poised to benefit from solid momentum in the Industrial and Expansion Markets segments. Growth in demand for powder finishing and lubrication product lines, as well as vehicle services, is supporting the Industrial segment’s performance. The Expansion Markets segment is gaining from solid momentum in the semiconductor business, driven by an increasing order rate.

Another peer, IDEX Corporation IEX, is witnessing weakness in the Fluid & Metering Technologies segment. Softness in agriculture, energy, water and semiconductor businesses is concerning for the segment. Also, weak chemical businesses, due to softness in the European chemicals market, are acting as a headwind for the segment.

NDSN’s Price Performance, Valuation and Estimates

Shares of Nordson have gained 8.6% in the past six months, almost in line with the industry’s growth of 8.7%.

From a valuation standpoint, NDSN is trading at a forward price-to-earnings ratio of 20.68X, above the industry’s average of 21.14X. Nordson carries a Value Score of D.

The Zacks Consensus Estimate for NDSN’s fiscal 2025 earnings has increased 0.7% over the past 30 days.

The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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