Reasons Why You Should Avoid Betting on Nordson (NDSN) Stock

Core Viewpoint - Nordson Corporation (NDSN) is facing challenges due to weak performance in the Advanced Technology Solutions segment and rising operating costs, which are expected to negatively impact earnings in the upcoming quarters [1]. Business Weakness - The Advanced Technology Solutions segment is experiencing decreased demand for electronics dispensing products, particularly in the cyclical semiconductor market, leading to a revenue decline of 17.6% in the fiscal first quarter ending January 2024 [2]. Steep Costs - The company is grappling with high sales costs, with the cost of sales increasing by 1.1% year over year in the first quarter due to rising input costs. Additionally, selling and administrative expenses rose by 2.4% year over year, driven by increasing acquisition costs, which threaten Nordson's profitability [3]. Forex Woes - Nordson's international operations expose it to risks from adverse currency fluctuations, particularly with a strengthening U.S. dollar, which may necessitate price increases or reduce profit margins in foreign markets. The Industrial Precision solution segment is notably vulnerable to these foreign currency headwinds [4]. Southbound Estimate Revisions - Over the past 60 days, the Zacks Consensus Estimate for NDSN's fiscal 2024 earnings has been revised downward by 0.2% [5]. Price Performance - Nordson's shares have increased by 28.7% over the past year, which is below the industry's growth of 32.9% during the same period [5].