DA Davidson and Jefferies issued commentary on WD-40 following its third-quarter results.
- DA Davidson called WD-40’s Q3 report a “strong beat”; Jefferies called it “solid.”
- For Q3, the company reported net sales of $195.1 million and adjusted earnings per share of $2.33.
- For the full year, adjusted EPS was guided between $6.05 and $6.35.
Shares of WD-40 (WDFC) surged on Friday after the company reported better-than-expected third-quarter (Q3) results, drawing praise from Wall Street firms DA Davidson and Jefferies.
According to TheFly, both firms raised their price targets on the company, which makes lubricants and household cleaning products.
At the time of writing, WDFC stock is up more than 23% and on track for its highest level in nearly 20 months, if session gains hold.
Wall Street Takeaway
DA Davidson called the report a “strong beat,” noting WD-40’s top-line strength and upside to gross margins, which helped increase profits.
However, the firm flagged that the impact of higher input costs will be felt with a lag into the fourth quarter, and pointed out that the full-year guidance raise, while coming in less than the beat, implies some giveback to the upside this quarter.
DA Davidson has a new price target of $305, up from $270, implying more than 27% upside potential as of the stock’s last close on Thursday, and maintained its ‘Buy’ rating.
Jefferies, on the other hand, kept its ‘Hold’ rating on WDFC but raised its price target to $245 from $229, implying upside potential of just over 2% based on the stock’s previous closing price. The firm also cheered the “solid” Q3 report but sounded a caution about high input costs expected down the line.
“While sales are set to move higher, higher input costs should squeeze margins through the first half of FY27 despite the recently announced price hikes,” the firm reportedly said.
Q3 Results At A Glance
WD-40’s consolidated net sales rose 24% year-on-year in Q3 to $195.1 million, which came ahead of the Koyfin consensus estimate of $177.6 million. Adjusted earnings per share (EPS) were $2.33, ahead of the $1.50 per share estimate.
For the full year, adjusted EPS was guided between $6.05 and $6.35, with revenue expected to be $652 million to $667 million, excluding forex fluctuations. The consensus estimates are $6.01 in adjusted EPS and $668.88 million in revenue.
What Retail Traders Think About WDFC
On Stocktwits, retail sentiment toward WDFC stock turned ‘extremely bullish’ to ‘bullish’ over the last 24 hours.
WDFC shares have climbed roughly 50% so far this year, outperforming the S&P 500.
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