Here’s why WD-40 stock jumped more than 11% in after-hours trading on Wednesday
- WD-40 beats Wall Street estimates in the fiscal third quarter.
- The U.S. firm raised its revenue guidance for the full year.
- WD-40 shares jumped more than 11% in extended trading.
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WD-40 Co (NASDAQ: WDFC) reported its financial results for the fiscal third quarter on Wednesday that beat Wall Street estimate.
WD-40 reported $21 million of net income in the third quarter that translates to $1.52 per share. In the same quarter last year, its net income was capped at $14.5 million, or $1.06 per share.
The American manufacturer of household and multi-use products generated $136.4 million of revenue in Q3 versus the year-ago figure of $98.2 million
According to FactSet, experts had forecast the company to post $108.3 million of revenue and $1.15 of EPS.
Guidance for the full year
For the full financial year, WD-40 raised its guidance for revenue to up to $490 million, representing an up to 20% annualised growth. Analysts, on the other hand, are calling for $461.9 million of full-year revenue.
The Nasdaq-listed company’s costs and expenses in the third quarter were higher than last year. In the prior quarter (Q2), WD-40’s net sales had jumped 12%.
CEO Garry Ridge’s comments
Commenting on the earnings report, CEO Garry Ridge said on Wednesday:
“We do not expect to see sales growth of this magnitude over the long-term, however, we believe that the new end-users who have interacted with our products during the pandemic will become permanent users of our maintenance products. As things get back to normal post the pandemic, consumer spending patterns will change again, and we expect consolidated net sales to grow in the mid to high single digits.”
Impact on the share price
Shares of the company climbed by more than 11% in extended trading. Including the price action, WD-40 stock is now more than 10% up on a year-to-date basis. At the time of writing, the San Diego-based company is valued at $3.57 billion and has a price to earnings ratio of 47.83