Nordson Corporation (NDSN) shares plunged almost 8% in after-hours trading as a downbeat 2025 forecast eclipsed an otherwise strong fourth quarter. The company posted $744 million in Q4 sales, up 4% year-over-year and ahead of analysts' estimates of $736.79 million. Adjusted earnings of $2.78 per share also beat the $2.59 consensus. But here's the kicker: organic sales dipped 3%, raising concerns about the company's ability to sustain growth amid ongoing market pressures.
CEO Sundaram Nagarajan didn't sugarcoat the challenges. Electronics and agriculture markets remain sluggish, with high borrowing costs and inflation curbing demand for Nordson's advanced technology and agricultural equipment. For fiscal 2025, Nordson is guiding revenues between $2.75 billion and $2.87 billion, falling short of Wall Street's $2.93 billion target. Adjusted earnings are forecasted at $9.70 to $10.50 per share, while analysts' expectation comes in at $10.37. With Q1 typically Nordson's weakest due to holiday slowdowns, the company expects revenue in the $615-$655 million range—well below the $676.54 million estimate.
Despite strong EBITDA margins of 32% and a free cash flow conversion rate of 105%, the market isn't buying into the long-term optimism management is preaching. Nordson's medical and fluid solutions saw a 19% sales boost thanks to its Atrion acquisition, but softness in its core segments is hard to ignore. As Nagarajan put it, the macro environment demands “a conservative viewpoint” heading into 2025. Investors clearly agree, sending the stock sliding in response.
