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Nordson Enhances Test & Inspection Unit With vivaMOS Buyout

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Zacks Equity Research
·3 min read
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Nordson Corporation NDSN recently announced the acquisition of vivaMOS Ltd. However, financial terms of the deal were kept under wraps. Nordson's shares increased 1.8% yesterday, eventually closing the trading session at $189.78.

Headquartered in Southampton, U.K, vivaMOS designs and manufactures large panel complementary metal–oxide–semiconductor (“CMOS”) image sensors for various X-ray applications.

Inside the Headlines

Notably, the transaction is in sync with Nordson's strategy to strengthen its test and inspection capabilities under the Advanced Technology Solutions segment.  The addition of vivaMOS’ advanced X-ray sensor technology will enable the company to expand the range of test and inspection solutions it offers to customers across various end-markets.

Buyout Activities of Nordson

The company intends to strengthen and expand its businesses through acquisitions. Notably, acquisitions had a positive impact of 0.8% on the company’s sales in the third quarter of fiscal 2020 (ended July 31, 2020).

Some of the other notable buyouts made by the company include the acquisition of Fluortek, Inc. in June 2020. Notably, the buyout is augmenting Nordson MEDICAL product lines under the company’s Advanced Technology Solutions segment. This apart, in July 2019, the company closed the buyout of Optical Control GmbH, a developer of high speed, fully-automatic counting systems. The buyout has augmented Nordson Electronic Solutions product lines.

Zacks Rank, Price Performance and Estimate Trend

The company, with a $10.9-billion market capitalization, currently carries a Zacks Rank #3 (Hold). In the quarters ahead, the company is poised to benefit from strength in its test & inspection, consumer non-durable, and medical end markets. Also, the implementation of its growth-focused framework might prove beneficial. However, weakness across its industrial end-markets is a concern.

In the past three months, the company’s shares have declined 1.7% against the industry’s growth of 8.6%.

In the past 30 days, the Zacks Consensus Estimate for the company’s earnings moved up 0.6% to $5.41 for fiscal 2020 (ending October 2020) on five upward estimate revisions against one downward revision. Over the same time frame, the consensus estimate for fiscal 2021 (ending October 2021) earnings inched up 1.1% to $6.42 on three upward estimate revisions against two downward.

Stocks to Consider

Some better-ranked stocks from the same space are Tennant Company TNC, Helios Technologies, Inc. HLIO and Altra Industrial Motion Corp. AIMC. While Tennant sports a Zacks Rank #1 (Strong Buy), Helios and Altra Industrial carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Tennant has trailing-four quarter earnings surprise of 107.12%, on average.

Helios has trailing four-quarter earnings surprise of 46.04%, on average.

Altra Industrial has trailing four-quarter earnings surprise of 31.43%, on average.

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