Wall Street Watch Tuesday: WD-40 Becomes a Squeaky Wheel

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WD-40
WD-40 (WDFC) may not be the all-weather company that investors thought they were buying. The company behind the namesake multi-purpose lubricant posted disappointing quarterly results after Monday's market close.

Revenue slipped 6% to $84.9 million in its fiscal fourth quarter, and net income declined 12% to $0.56 a share. You'll be seeing plenty of companies post lower financial results this challenging earnings season, but it wasn't supposed to be that way for WD-40.

Analysts figured that the company would actually grow both ends of its income statement, clocking in with a profit of $0.70 a share on $93.7 million in revenue.

WD-40 makes more than just its signature handyman spray. This is also the company behind Lava industrial-strength soap, X-14 bathroom cleaners, and Carpet Fresh odor neutralizer.

The company's wide range of household staples should deliver reliable results, but that's just not happening here. WD-40 has now posted lower than expected profitability in three of the past four quarters.

WD-40 argues that some of the sales slipped into the new fiscal year, particularly in the fiscally wobbly Europe. It's easy for investors to be skeptical, especially since its guidance -- while encouraging in terms of revenue -- merely keeps up with Wall Street's profit target.

WD-40 has plenty to prove. For starters, can its multi-purpose toolbox staple get it out of its current jam?

Other Things Worth Watching

• Joe's Jeans (JOEZ) proved to be a nice fit. The premium denim specialist posted a profit of $0.02 a share on a 25% surge in net sales. Analysts were actually expecting a quarterly deficit on a mere 15% pop on the top line. Between a 26% surge in net wholesale sales and a healthy 7% uptick in same-store sales on the retail side, folks apparently aren't shying away from an expensive pair of jeans if the brand and fit are right.

• There will be another hat for priceline.com (PCLN) CEO Jeffery Boyd to wear. The travel booking website operator revealed on Monday night that Board Chairman Ralph Bahna will retire next year. Boyd -- who is already both president and CEO -- will succeed Bahna as chairman. Some investors prefer to see different executives wearing these different hats, but the concentration does make the one helmsman more accountable.

Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article. The Motley Fool owns shares of Priceline.com. Motley Fool newsletter services have recommended buying shares of Priceline.com.





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Conrad

I was a big user of the WD40 until they went to the flip spray nozzles.Seems like a added expence i view it as a waste.I also had to throw away 2 cans for pluged nozzles,i admit the cans were old but still had plenty pressure. K.i.s.s [ keep it simple stupid ] is generally the best way to go.

October 17 2012 at 10:51 AM Report abuse rate up rate down Reply
flashofgreeneyes

Uhm, itts not who will, as in the "future" Obama already has! All thats left is the hefty bag I can be buried in if he gets re-elected!

October 17 2012 at 12:16 AM Report abuse rate up rate down Reply
halkovichr

price of wd 40 now i went to a spray bottle with transmission in it instead

October 16 2012 at 6:07 PM Report abuse rate up rate down Reply
Davie2743

Many of WD 40 competitors claim the product does not actually displace water or moisture I personally would concur with this opinion.

October 16 2012 at 4:54 PM Report abuse rate up rate down Reply
Brian

Prove it's not the Republican House which is a disaster instead!

October 16 2012 at 4:46 PM Report abuse -1 rate up rate down Reply
jackgol4

obama is a disaster for the country!!

October 16 2012 at 12:22 PM Report abuse +2 rate up rate down Reply