Why WD-40 Shares Jumped
Jan 9th 2013 5:20PM
Updated Jan 9th 2013 5:28PM
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of household products-maker WD-40 jumped as much as 11% today, after the company reported better-than-expected earnings in its fiscal first quarter.
So what: Diluted earnings per share jumped from $0.42 a year ago to $0.69 and easily cleared estimates of $0.56. Revenue improved steadily, climbing 12% to $95.3 million. Oddly enough, Europe showed the biggest gains in the company's three regions, with a 17% bump in sales. Guidance was also slightly ahead of expectations, as the company projects revenue of $356 million to $370 million and EPS of $2.31 to $2.40 for fiscal 2013.
Now what: Nothing too complicated here. The market clearly rewarded a resounding earnings beat, affirming a solid brand in a sleepy industry. WD-40 recently raised its dividend 7% and is in the process of $50 million share buyback program. This isn't the kind of stock that's going to be giving multibagger returns, but it's hard to argue with a well-respected brand in a stable industry and a management team focused on returning capital shareholders. Keep up with WD-40 by adding the company to your Watchlist here.
The article Why WD-40 Shares Jumped originally appeared on Fool.com.Jeremy Bowman and The Motley Fool have no position in any of the stocks mentioned. 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.
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