Look, I get it. When someone mentions “precision dispensing systems for adhesives,” your eyes probably glaze over faster than a Krispy Kreme donut. But hear me out – sometimes the most boring companies make the best investments. And Nordson (NDSN) might just be the sleeper hit your portfolio needs.
What Makes a Dividend King?
First, let’s talk Dividend Kings – these are companies that have raised their dividends for at least 50 consecutive years. Think about that for a second. These businesses survived disco, the dot-com crash, 2008’s financial meltdown, and even TikTok dances. They’re basically the cockroaches of the investment world, but in the best possible way.
Nordson has been paying and raising dividends for 63 years straight. That’s longer than most people have been alive. While everyone’s chasing the next hot AI stock, this Ohio-based company has been quietly making money by helping other companies stick things together better.
The Beauty of Boring
Peter Lynch, the legendary investor, loved boring companies because Wall Street ignores them. Case in point: only 10 analysts cover Nordson, while Nvidia has 54 analysts breathing down its neck. Less attention often means better opportunities for regular investors like us.
So what does Nordson actually do? They make the machines that dispense adhesives, sealants, and coatings in manufacturing. Think of them as the unsung heroes behind your smartphone screen, car dashboard, and medical devices. Not sexy, but absolutely essential.
The Numbers Don’t Lie
Here’s where it gets interesting. Nordson just posted record sales of $2.8 billion and generated $661 million in free cash flow. Their dividend has grown at an 18% annual rate over the past five years – that’s not a typo. Meanwhile, they only pay out 34% of their earnings as dividends, leaving plenty of room for future increases.
Over the last decade, NDSN delivered 320% returns versus the S&P 500’s 274%. Not bad for a “boring” stock, right?
The Reality Check
Now, before you mortgage your house to buy Nordson stock, remember that even Dividend Kings can stumble. Just ask 3M shareholders – they cut their dividend in 2024 after 60+ years of increases. The key is finding companies with strong fundamentals, not just impressive streaks.
Nordson checks the boxes: they operate in over 35 countries, invest heavily in R&D, and serve diverse industries from electronics to renewable energy. When one sector slows down, others pick up the slack.
The Bottom Line
While everyone’s fighting over the latest meme stock, Nordson quietly compounds wealth through boring, profitable business operations. It’s not going to make you rich overnight, but it might just triple your money over the next decade through the magic of reinvested dividends and steady growth.
Sometimes the best investment strategy is finding a company that does something essential, does it well, and has been doing it longer than you’ve been alive. Nordson fits that bill perfectly.