Contrasting Nordson Corporation (NDSN) and Tennant (TNC)
Nordson Corporation (NASDAQ: NDSN) and Tennant (NYSE:TNC) are both industrial products companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, risk and institutional ownership.
Institutional & Insider Ownership
66.4% of Nordson Corporation shares are held by institutional investors. Comparatively, 90.0% of Tennant shares are held by institutional investors. 2.2% of Nordson Corporation shares are held by company insiders. Comparatively, 5.7% of Tennant shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Volatility and Risk
Nordson Corporation has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, Tennant has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500.
This table compares Nordson Corporation and Tennant’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Nordson Corporation and Tennant’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Nordson Corporation||$2.00 billion||3.14||$534.78 million||$5.02||21.68|
|Tennant||$873.73 million||1.25||$91.45 million||$1.12||54.91|
Nordson Corporation has higher revenue and earnings than Tennant. Nordson Corporation is trading at a lower price-to-earnings ratio than Tennant, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current recommendations and price targets for Nordson Corporation and Tennant, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Nordson Corporation currently has a consensus target price of $133.60, indicating a potential upside of 22.75%. Tennant has a consensus target price of $65.00, indicating a potential upside of 5.69%. Given Nordson Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Nordson Corporation is more favorable than Tennant.
Nordson Corporation pays an annual dividend of $1.20 per share and has a dividend yield of 1.1%. Tennant pays an annual dividend of $0.84 per share and has a dividend yield of 1.4%. Nordson Corporation pays out 23.9% of its earnings in the form of a dividend. Tennant pays out 75.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Nordson Corporation has increased its dividend for 45 consecutive years and Tennant has increased its dividend for 3 consecutive years.
Nordson Corporation beats Tennant on 13 of the 17 factors compared between the two stocks.
Nordson Corporation Company Profile
Nordson Corporation engineers, manufactures and markets differentiated products and systems used to dispense, apply and control adhesives, coatings, polymers, sealants, biomaterials, and other fluids, to test and inspect for quality, and to treat and cure surfaces. The Company’s segments include Adhesive Dispensing Systems, Advanced Technology Systems and Industrial Coating Systems. The Adhesive Dispensing Systems segment delivers its precision dispensing and processing technology to various markets. The Advanced Technology Systems segment integrates its product technologies found in progressive stages of a customer’s production process, such as surface treatment, precisely controlled automated, and post-dispense bond testing, optical inspection and X-ray inspection. The Industrial Coating Systems segment provides equipment used primarily for applying coatings, paint, finishes, sealants and other materials, and for curing and drying of dispensed material.
Tennant Company Profile
Tennant Company is engaged in designing, manufacturing and marketing of cleaning solutions. The Company’s segments are Americas; Europe, Middle East, Africa, and Asia Pacific. The Company offers a range of products, including floor maintenance and outdoor cleaning equipment, detergent-free and other sustainable cleaning technologies, aftermarket parts and consumables, equipment maintenance and repair service, specialty surface coatings and asset management solutions. Its products are used in various types of environments, including retail establishments, distribution centers, factories and warehouses, public venues such as arenas and stadiums, office buildings, schools and universities, hospitals and clinics, parking lots and streets. The Company markets and sells its products under various brands: Tennant, Nobles, Green Machines, Alfa Uma Empresa Tennant, IRIS, Orbio IPC, IPC Foma, IPC Eagle, IPC Gansow, ICA, Vaclensa, Portotecnica, Sirio and Soteco, Ready System, Euromop, and Pulex.
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