NDSN: Accelerating Growth with Recurring Revenue at Nearly One-Half of Sales
- EPS is projected up 16% in FY18 to a record $6.24, aided by the October 31st backlog up 45% to $402 million, new products/applications, acquisition benefits and effective margin improvement initiatives.
- The rapidly growing Advanced Technology Systems segment (43% of sales) now generates around 50% of revenue outside of electronics (vs 15% five years ago), providing additional growth opportunities and diversification.
- Parts and consumables (47% of sales) provide recurring revenue.
- International markets (69% of sales) are longer-term growth drivers and should benefit from improvement in economies abroad.
- Dividends have been increased annually for 54 years, a record only 13 other publicly traded companies can meet or exceed.
Nordson engineers, manufactures and markets differentiated products and systems used for dispensing, applying and controlling of adhesives, coatings, polymers, sealants, biomaterials, and other fluids, to test and inspect for quality, and to treat and cure surfaces. The company serves a range of consumer non-durable, consumer durable and technology end markets including packaging, nonwovens, electronics, medical, appliances, energy, transportation, building and construction, and general product assembly and finishing. The company has three operating segments: Adhesive Dispensing Systems, Advanced Technology Systems, and Industrial Coating Systems.
Great Lakes Review is located in Cleveland, Ohio, was founded in 1981 and became a division of Wellington Shields & Co. LLC in 2011. Great Lakes Review is a research boutique focused on the fundamentally-oriented investor seeking companies that dominate their respective specialty niche regardless of industry. The objective is to make money for the long-term by gradually accumulating a diversified portfolio from a universe of no more than 30 companies. Although short-term-oriented accounts will be alerted to trading opportunities, aggressive sell recommendations are triggered only by a deterioration in long-term fundamentals, not by short-term blips or investor fancy. Coverage of those names that lose their earnings momentum or earnings predictability may be dropped and replaced with more vital candidates.
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