Yahoo Finance Nordson Corporation Just Reported And Analysts Have Been Lifting Their Price Targets
Nordson Corporation (NASDAQ:NDSN) shares fell 3.7% to US$162 in the week since its latest yearly results. Nordson reported in line with analyst predictions, delivering revenues of US$2.2b and earnings per share of US$5.79, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest forecasts to see whether analysts have changed their mind on Nordson after the latest results.
View our latest analysis for Nordson
Taking into account the latest results, the current consensus from Nordson's eight analysts is for revenues of US$2.24b in 2020, which would reflect a satisfactory 2.3% increase on its sales over the past 12 months. Earnings per share are expected to rise 6.4% to US$6.24. Yet prior to the latest earnings, analysts had been forecasting revenues of US$2.28b and earnings per share (EPS) of US$6.47 in 2020. Analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share forecasts for next year.
Although analysts have revised their earnings forecasts for next year, they've also lifted the consensus price target 9.0% to US$166, suggesting the revised estimates are not indicative of a weaker long-term future for the business. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Nordson at US$188 per share, while the most bearish prices it at US$136. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Nordson's past performance and to peers in the same market. It's pretty clear that analysts expect Nordson's revenue growth will slow down substantially, with revenues next year expected to grow 2.3%, compared to a historical growth rate of 7.2% over the past five years. Juxtapose this against the other companies in the market with analyst coverage, which are forecast to grow their revenues (in aggregate) 1.7% next year. So it's pretty clear that, while Nordson's revenue growth is expected to slow, it's still expected to grow faster than the market itself.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Nordson's revenues are expected to grow faster than the wider market. There was also a nice increase in the price target, with analysts feeling that the intrinsic value of the business is improving.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Nordson analysts - going out to 2021, and you can see them free on our platform here.
You can also view our analysis of Nordson's balance sheet, and whether we think Nordson is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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