What Happened?
Shares of manufacturing company Nordson (NASDAQ: NDSN) jumped 6.8% in the morning session after it reported strong second-quarter financial results that surpassed Wall Street expectations for both revenue and profit. The precision dispensing equipment manufacturer reported second-quarter revenue of $741.5 million, an increase of 12.1% year-over-year and ahead of the consensus estimate of $722.2 million. Adjusted earnings per share came in at $2.73, up from $2.41 in the prior year and surpassing Wall Street's expectation of $2.64. The better-than-expected results were supported by organic revenue growth of 2.1%, which analysts had expected to be flat. The company also demonstrated strong cash generation, with its free cash flow margin improving to 30.5% from 21.6% in the same quarter last year.
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What Is The Market Telling Us
Nordson’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 8 months ago when the stock dropped 8.2% on the news that the company reported weak third-quarter financial results. Its full-year revenue and earnings guidance fell short of Wall Street's estimates, sending shares lower. On the other hand, Nordson exceeded analysts' revenue, EBITDA, and EPS expectations this quarter. Overall, this quarter could have been better.
Nordson is up 10.9% since the beginning of the year, but at $226.96 per share, it is still trading 14.1% below its 52-week high of $264.36 from November 2024. Investors who bought $1,000 worth of Nordson’s shares 5 years ago would now be looking at an investment worth $1,202.
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