WD-40 Earnings: An Early Look

The new earnings season is about to begin, but a few companies on off-quarter fiscal years are just now getting around to reporting their quarterly results. WD-40 is about to release its earnings report. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you'll be less likely to make an uninformed kneejerk reaction to news that turns out to be exactly the wrong move.

Most people think of WD-40 as a single-product company, with its namesake solvent being ubiquitous with a place on just about every garage shelf in America. But the company does have a few other products in its arsenal. Let's take an early look at what's been happening with WD-40 over the past quarter and what we're likely to see in its quarterly report on Thursday.

Stats on WD-40

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$87.4 million

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

Will WD-40 get the job done this quarter?
Analysts have had mixed views on WD-40 recently, cutting back on earnings estimates for the just-ended quarter but boosting their full-year fiscal 2013 calls by $0.03 per share. The stock has done quite well lately, though, rising almost 14% since the beginning of the year.

WD-40 reaps the benefits of having its small niche largely to itself. But beyond its namesake product, it also makes Lava soap and 2000 Flushes bathroom cleanser, putting itself up against much larger consumer-oriented giants like Unilever's Dove soap line and Procter & Gamble's numerous cleaning products.

What may be surprising is the extent to which WD-40 has followed in Unilever and P&G's steps by looking to overseas markets for growth opportunities. Unfortunately, WD-40 has a much larger presence in Europe than in Asia, and given Europe's struggles, the company could face tougher times ahead until the economy there manages to rebound. That's consistent with Procter & Gamble's challenges overseas, although Unilever has done a good job taking advantage of P&G's miscues to tap into global growth prospects.

Still, WD-40 is never going to reach a scale even approaching its consumer-giant rivals. Rather, it has pigeonholed itself fairly well into what has been a successful niche for the company, albeit with only modest prospects for future growth.

In its quarterly report, watch for WD-40 to give details on how its $50 million share buyback program is going. With the company sporting impressive cash flow that has financed rising dividends lately, investors in WD-40 aren't looking for a quick score. Rather, as long as long-term prospects remain favorable, a small decline in year-over-year earnings shouldn't cause any huge disruptions unless it comes with future concerns down the road.

The best investing approach is to choose great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" names stocks that could help you build long-term wealth and retire well, along with some winning wealth-building strategies that every investor should be aware of. Click here now to keep reading.

Click here to add WD-40 to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

The article WD-40 Earnings: An Early Look originally appeared on Fool.com.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends Procter & Gamble and Unilever. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.