Contrasting Nordson (NASDAQ:NDSN) & Generac (NYSE:GNRC)

Nordson (NASDAQ:NDSN) and Generac (NYSE:GNRC) are both large-cap industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Risk and Volatility

Nordson has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, Generac has a beta of 1.68, meaning that its stock price is 68% more volatile than the S&P 500.

Profitability

This table compares Nordson and Generac’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nordson	16.51%	19.10%	9.60%
Generac	7.91%	19.14%	9.19%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Nordson and Generac, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nordson	0	5	4	1	2.60
Generac	0	5	13	0	2.72

Nordson presently has a consensus target price of $254.8571, suggesting a potential upside of 17.33%. Generac has a consensus target price of $170.0556, suggesting a potential downside of 14.56%. Given Nordson’s higher probable upside, equities research analysts clearly believe Nordson is more favorable than Generac.

Earnings and Valuation

This table compares Nordson and Generac”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nordson	$2.69 billion	4.56	$467.28 million	$7.78	27.92
Generac	$4.30 billion	2.72	$325.26 million	$6.02	33.06

Nordson has higher earnings, but lower revenue than Generac. Nordson is trading at a lower price-to-earnings ratio than Generac, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

72.1% of Nordson shares are owned by institutional investors. Comparatively, 84.0% of Generac shares are owned by institutional investors. 0.8% of Nordson shares are owned by company insiders. Comparatively, 2.7% of Generac shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Generac beats Nordson on 8 of the 15 factors compared between the two stocks.

About Nordson

Nordson Corporation engineers, manufactures, and markets products and systems to dispense, apply, and control adhesives, coatings, polymers, sealants, biomaterials, and other fluids worldwide. It operates through three segments: Industrial Precision Solutions; Medical and Fluid Solutions; and Advanced Technology Solutions. The Industrial Precision Solutions segment provides dispensing, coating, and laminating systems for adhesives, lotions, liquids, and fibers to disposable products and roll goods; automated adhesive dispensing systems used in packaged goods industries; components and systems used in the thermoplastic and biopolymer melt stream; precision agriculture spraying solutions; fluid components, such as nozzles, pumps, and filters; and product assembly systems for use in paper and paperboard converting applications, and manufacturing roll goods. It also offers automated and manual dispensing products and systems for cold materials, container coating, liquid finishing, and powder coating, as well as ultraviolet equipment used primarily in curing and drying operations. The Medical and Fluid Solutions segment offers medical devices, including cannulas, catheters, and medical balloons; single-use plastic components; precision manual and semi-automated dispensers; minimally invasive interventional delivery devices; and plastic molded syringes, cartridges, tips, and fluid connection components. The Advanced Technology Solutions segment provides automated dispensing systems for the attachment, protection, and coating of fluids, as well as related gas plasma treatment systems for cleaning and conditioning surfaces; and bond testing and automated optical, acoustic microscopy, and x-ray inspection systems for use in semiconductor and printed circuit board industries. The company markets its products through direct sales force, as well as distributors and sales representatives. Nordson Corporation was founded in 1909 and is headquartered in Westlake, Ohio.

About Generac

Generac Holdings Inc. designs, manufactures, and distributes various energy technology products and solution worldwide. The company offers residential automatic standby generators, automatic transfer switch, air-cooled engine residential standby generators, and liquid-cooled engine generators; Mobile Link, a remote monitoring system for home standby generators; residential storage solution, which consists of a system of batteries, an inverter, photovoltaic optimizers, power electronic controls, and other components; smart home solutions, such as smart thermostats and a suite of home monitoring products. It also provides smart home energy management devices and sensors for heating and cooling system; smart doorbell cameras; and portable and inverter generators; multiple portable battery solutions; manual transfer switches; outdoor power equipment, including trimmers, field and brush mowers, log splitters, stump grinders, chipper shredders, lawn and leaf vacuums, and pressure washers and water pumps; and battery-powered turf care products. In addition, the company offers commercial and industrial products comprising cleaner-burning natural gas fueled generators; light-commercial standby generators and related transfer switches; stationary generators; single-engine industrial generators; industrial standby generators; industrial transfer switches; light towers, mobile generators, commercial mobile pumps, heaters, dust-suppression equipment, and mobile energy storage systems; stationary energy storage system and related inverter products; and aftermarket service parts and product accessories. The company distributes its products through independent residential dealers, industrial distributors and dealers, national and regional retailers, e-commerce partners, electrical/HVAC/solar wholesalers, solar installers, catalogs, equipment rental companies, and other equipment distributors; and directly to end users. The company was founded in 1959 and is headquartered in Waukesha, Wisconsin.