WD-40 COMPANY (WDFC): what the price assumes
In the published model solve dated 2026-Q2, anchored at $217.17, WD-40 COMPANY (WDFC) is priced for +14.9% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-28.
Generated: 2026-08-30 · Exported: 2026-08-31 · Source: https://boothcheck.com/report/WDFC
Headline
| Field | Value |
|---|---|
| Ticker | WDFC |
| Company | WD-40 COMPANY |
| Current price | $217.17/sh |
| Composition | WD-40 Multi-Use Product 77% / WD-40 Specialist 13% / Other maintenance products (3-IN-ONE and GT85) 5% / Homecare and cleaning products (HCCP) 5% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 8.8% |
| Operating margin today | 17.5% |
| Margin compression (value-band) | -8.7pp |
| Implied growth | 14.9% |
| Multiple paid | 25x operating income |
The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 8.2% cost of capital with 4% terminal growth over a 5-year stage.
How unusual the bet is: within-range (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | +2.11σ |
| cohort percentile (of 78 peers) | 71 |
Valuation X-Ray
Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 3.02x | 5 | expensive |
| Earnings | 3.62x | 5 | expensive |
| Relative | 2.75x | 5 | expensive |
| Growth | 1.15x | 3 | expensive |
Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.9%); the inversion above states its own rate.
Per-Model Detail (n=18)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $149.25 | 1.46x | yes | FCF base $0.1B, growth 10% (input: historical growth), terminal g 4.0%, WACC 8.9%, 6yr projection |
| DCF Exit Multiple | Growth | $223.99 | 0.97x | yes | Exit EV/EBITDA: 22.7x / 24.7x / 26.7x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $127.89 | 1.70x | yes | P/E 19.6x (blended: static sector reference 14x + trailing (TTM) 33x), scenarios: 16.2x / 19.6x / 23.0x (bear / base = reference held flat / bull), EV/EBITDA 13.02x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $71.87 | 3.02x | yes | BV/sh $20.77, ROE (TTM) 32.0%, ke 9.3% |
| Two-Stage Excess Return | Asset | $139.78 | 1.55x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $189.33 | 1.15x | yes | Rev $0.7B, growth 10% (input: historical growth; tapered), Terminal P/S: 3.6x / 4.3x / 5.1x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $79.08 | 2.75x | yes | EPS $6.59, growth 8% (input: historical EPS growth), PEG=3.88 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $56.43 | 3.85x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.10B × (1−24%) / WACC 8.9% → EPV (no growth) |
| Residual Income | Asset | $110.65 | 1.96x | yes | BV $20.77 + 5yr PV of (ROE (TTM) 32.0% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $55.49 | 3.91x | yes | √(22.5 × EPS $6.59 × BVPS $20.77) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $67.42 | 3.22x | yes | EBITDA $0.12B × sector EV/EBITDA 8.0x |
| FCF Yield | Earnings | $59.92 | 3.62x | yes | FCF $79.5M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $53.75 | 4.04x | yes | SBC-adj FCF $0.07B (FCF $0.08B − SBC $0.01B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $139.94 | 1.55x | yes | EPS $6.59 × (8.5 + 2×8.4%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $21.47 | 10.12x | yes | BV $20.77 × (ROIC 9.2% / WACC 8.9%) |
| P/Sales Sector | Relative | $75.41 | 2.88x | yes | Revenue $0.67B × sector P/S 1.5x |
| PEG Fair Value | Relative | $83.22 | 2.61x | yes | EPS $6.59 × (PEG 1.5 × growth 8.4% (input: historical EPS growth)) → PE 12.6x |
| Earnings Yield | Earnings | $71.24 | 3.05x | yes | EPS $6.59 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $41.5m |
| Net debt / NOPAT (after-tax) | 0.46x |
| Net debt / operating income (pre-tax) | 0.35x |
| Interest coverage | 42.6x |
| Share count CAGR (buyback) | -0.4% |
| Burning cash | no |
Bullet Takeaways
- WD-40 is effectively a one-brand company, with maintenance products now 97% of revenue, and it runs that brand at a gross margin of 55.6%, the kind of pricing power that comes from a household name with no real substitute on the shelf.
- The biggest risk is the price, not the business: at $228 no family of valuation method reaches the stock, so the premium rests on the brand compounding at a pace well above what a mature consumer-products company normally sustains.
- What to watch is whether growth holds against an elevated multiple: the company grew second-quarter sales 11% and reaffirmed full-year guidance for net sales of $630 to $655 million and diluted EPS of $5.75 to $6.15.
Bull Case
The most revealing thing about WD-40 is what management does with the cash, because a single-brand company that throws off this much margin has to allocate capital with discipline or it drifts. The company has chosen to concentrate rather than diversify. Maintenance products are now 97% of revenue, and the strategy is explicitly to push the WD-40 Multi-Use Product and WD-40 Specialist lines while pulling back on advertising and promotion for lower-priority brands, a deliberate focus the company describes as its four-by-four strategic framework. That focus is a capital-allocation statement: spend behind the brand that earns the highest return and let the rest fade.
The economics that focus produces are what justify the market's regard. Gross margin reached 55.6% in the second quarter, a level that says the blue-and-yellow can commands a price its cost base does not require. WD-40 has the rare consumer-products quality of being cheap in absolute dollars but having no close substitute in the user's mind, which lets the company raise price and hold volume. The 10-K describes exactly that dynamic: after price increases, volume recovered as customers adjusted, and that recovery continued into the most recent fiscal year, lifting sales period over period. A brand that can take price and keep its volume is the textbook definition of pricing power.
The growth engine is geographic breadth on top of that pricing. Second-quarter sales rose 11%, with maintenance products up 13%, and the strength was broad-based across the Americas, the combined Europe-India-Middle East-Africa region, and Asia-Pacific. For a brand most associated with a single market, the runway is the rest of the world, where the product is under-penetrated and the same focus strategy can be replayed. Management reaffirmed full-year guidance for net sales of $630 to $655 million, operating income of $103 to $110 million, and diluted EPS of $5.75 to $6.15, and the balance sheet is pristine, carrying only a modest net debt position with operating earnings covering interest dozens of times over. This is a clean compounder that returns its cash and grows a beloved brand into new markets.
Bear Case
The honest bear case starts with the cycle this kind of business runs, because WD-40's recent strength is partly a recovery, not a new baseline. The 10-K is explicit that the higher sales of the last two fiscal years reflect a volume recovery after customers absorbed earlier price increases. That is a one-time normalization, not a permanent acceleration. A mature consumer brand that grows by taking price and then watching volume recover to the prior trend is not a structural double-digit grower; it is a low-single-digit volume business with periodic pricing resets. The second-quarter growth of 11% flattered by foreign-exchange and pricing should be read against the constant-currency maintenance-product figure of 6%, which is a truer picture of the underlying demand.
The structural vulnerability is concentration at both ends. On the product side, the company is now 97% one category, so there is no diversification to cushion a stumble in the core. On the customer side, WD-40 sells through retailers and distributors, and the company warns that customer strategies such as shelf simplification, discontinuing product offerings, or shifting shelf space to competitors could reduce its sales. A brand this dependent on physical retail placement is exposed to the buying decisions of a concentrated set of large customers, and the rise of private-label and competing maintenance sprays gives those customers leverage. Input costs add a margin wobble, since the product is petroleum-derived and the cost base moves with chemical and freight prices the company does not control.
The valuation is where the bear case becomes hard to wave away, because the price sits above every method. At $228 the asset-value methods, the earnings-power methods, the peer multiples, and even the forward-growth methods all land below the price, several at a quarter to a third of it. The earnings-power lens, which capitalizes today's profit with no growth, reads the price at roughly four times what current earnings support. When no standard frame reaches the quote, the market is paying for the brand to grow operating income at better than 20% a year and to keep doing it, a pace far above what a mature household-products company has historically sustained. The quality of the brand is not in dispute. What is in dispute is whether a low-to-mid single digit organic grower deserves a price that requires compounding several times that fast.
Valuation
WD-40's valuation is best read as the market paying a steep premium for brand durability, and the inversion makes the size of that premium concrete: at today's price the business has to grow operating income at better than 20% a year, a rate that sits far above the low-to-mid single digit organic growth a mature consumer brand normally delivers. The company earns operating margins around 16.5% today, and the price assumes both growth and margin keep climbing.
What distinguishes this name is that no family of method reaches the price. The asset-value methods, built off book value and the return spread, land well below it. The earnings-power lens, capitalizing current profit with no growth, sits at roughly a quarter of the price, a reflection of how much of the quote is future growth rather than present earnings. Peer multiples land around half the price or less, and even the forward-growth methods, which credit continued compounding, fall short. That is the signature of a price that embeds a scenario beyond what any conventional frame supports. It is not a contradiction in the methods; it is the market assigning a durability premium to a brand it believes will compound longer and more reliably than the cohort, isolated here so a buyer can weigh it directly rather than have it buried in an average.
The balance sheet removes any solvency question and lets the debate stay where it belongs, on growth. WD-40 carries only a small net debt position, under half of trailing operating income, with operating earnings covering interest dozens of times over. There is no fragility to compound a slowdown; a disappointing growth year would compress the multiple, not threaten the company. The decisive judgment for the value is therefore singular and clean: the brand is genuinely excellent and the margins are genuinely high, but the price is not asking whether the business is good. It is asking whether a beloved but mature single-brand company can grow several times faster than its history, for years, and that is the bet a buyer at this price is making.
Catalysts
The second-quarter fiscal 2026 report, released in April, was the most recent catalyst, and it was a solid operational quarter that the market received cautiously given the valuation. Net sales rose 11% to $161.7 million, maintenance products grew 13%, gross margin expanded to 55.6%, and operating income increased 13% to $26.3 million, with GAAP and non-GAAP EPS of $1.50. The growth was broad-based across the Americas, the Europe-India-Middle East-Africa region, and Asia-Pacific, consistent with the geographic expansion strategy. Management reaffirmed full-year guidance for net sales of $630 to $655 million, gross margin of 55.5 to 56.5%, operating income of $103 to $110 million, and diluted EPS of $5.75 to $6.15.
The forward catalysts are about whether the growth justifies the multiple. The constant-currency growth rate, the trajectory of maintenance-product volume in the international segments, and gross margin against petroleum-derived input costs are the variables to watch each quarter. Because the price already embeds an aggressive growth assumption, the more important catalyst risk is to the downside: any quarter where reaffirmed guidance is trimmed, or where volume growth slows beneath the pricing, would weigh heavily on a stock priced for sustained high-rate compounding. The next earnings report is the test of whether the broad-based momentum holds.
Peer Cohorts (Per Segment, With Filing Citations)
EIMEA (reported)
- NEU (NEWMARKET CORPORATION)
- FY2025 10-K: …The AMPAC site in Cedar City, Utah joined the ACC in 2024 and is pursuing RCMS certification. The newly acquired Calca 10 Table of Contents site in Lake Charles, Louisiana has been a leader in the Society of Chemical Manufacturers and Affiliates (SOCMA), implementing their ChemStewards® program, and will also pursue…
- FY2025 10-K: …that environmental compliance and safety are individual responsibilities. Every employee at NewMarket is responsible for ensuring that our high standards in the area of health, safety (including process safety), environmental protection, and security are upheld at all times. Our Global Responsible Care Policy…
- IOSP (INNOSPEC INC.)
- FY2025 10-K: …with developing customer needs. In addition, the business has developed further formulations in emollients, silicones and surfactants for the personal care, home care, agrochemical, construction, mining and other industrial markets. Fuel Specialties has continued to innovate, focused on bringing new technologies to…
- FY2025 10-K: …and employees. As a result, there could be a consequential adverse impact on our results of operations, financial condition and cash flows. Decline in our AvGas business. The sales of our AvGas product line for use in aviation gasoline are recorded within our Fuel Specialties business. The piston aviation industry…
- FUL (FULLER H B CO)
- FY2025 10-K: …laws could result in damage to our reputation and payment of monetary penalties. Seasonality Our operating segments have historically had lower net revenue in winter months, which is primarily our first fiscal quarter, mainly due to international holidays and the seasonal decline in construction and consumer spending…
- FY2025 10-K: …Vice President, Engineering Adhesives Asia Pacific and Global Product Management July 2023 - December 2024 Vice President, Engineering Adhesives Asia Pacific and Global Automotive and Aerospace October 2021 - July 2023 Vice President, Engineering Adhesives Asia Pacific and Global Durable Assembly August 2019 -…
- SMG (Scotts Miracle-Gro Co)
- FY2025 10-K: …risks to maintain and promote a safer workplace. During new hire orientation, associates receive customized health and safety training based on job type and level. Our EHS training of supervisors focuses on knowledge of applicable regulations and necessary systems and leadership training elements so that each shift…
- FY2025 10-K: …10-Q 4.2 May 6, 2020 4.1(d) Third Supplemental Indenture, dated March 29, 2021, by and among The Scotts Miracle-Gro Company, the Guarantors (as defined therein) and U.S. Bank National Association, as trustee 10-Q 4.2 May 12, 2021 4.1(e) Fourth Supplemental Indenture, dated June 24, 2021, by and among The Scotts…
- CSW (CSW INDUSTRIALS, INC.)
- FY2025 10-K: …Product Development - Strategic investment in new product innovation, technical advancement, and customer-driven product development enhances demand for our products and enriches relationships with end-users. Development teams are located in Boise, Idaho; Hudson, Florida; Wichita, Kansas and Windsor Ontario, Canada.…
- FY2025 10-K: …which enhances our ability to both "pull" demand from the end-user and "push" demand to distributor partners. Specialized Reliability Solutions' customers include petrochemical facilities, industrial manufacturers, construction companies, utilities, plant maintenance customers, building contractors and rail and…
- BCPC (Balchem Corp)
- FY2025 10-K: …to range from $40,000 to $45,000 for 2026, including our continued efforts to invest in energy and water saving projects, while exploring additional renewable energy opportunities in supporting our future growth and capacities. Environmental and Regulatory Matters The Federal Insecticide, Fungicide and Rodenticide…
- FY2025 10-K: …confident that the sterilization industry as a whole will take appropriate measures to comply with the latest EPA requirements in a timely manner, there is no assurance that this will consistently be the case. The Company plans on continuing to work with various stakeholders to help ensure the EPA considers all…
- AVNT (AVIENT CORPORATION)
- FY2025 10-K: …Europe, the Middle East, and Africa. We own the majority of our manufacturing sites. We believe that the quality and production capacity of our facilities is sufficient to maintain our competitive position for the foreseeable future. The following table identifies the principal facilities of our segments: Specialty…
- FY2025 10-K: …us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:CrossCurrencyInterestRateContractMember avnt:January2029Member us-gaap:NetInvestmentHedgingMember 2025-12-31 0001122976 us-gaap:OtherCurrentLiabilitiesMember us-gaap:DesignatedAsHedgingInstrumentMember us-gaap:CrossCurrencyInterestRateContractMember…
- SXT (Sensient Technologies Corp)
- FY2025 10-K: …srt:NorthAmericaMember sxt:AsiaPacificSegmentMember 2023-01-01 2023-12-31 0000310142 sxt:ColorMember us-gaap:AllOtherSegmentsMember srt:ReportableGeographicalComponentsMember 2023-01-01 2023-12-31 0000310142 srt:ReportableGeographicalComponentsMember us-gaap:AllOtherSegmentsMember sxt:ColorMember 2025-12-31…
- FY2025 10-K: 10.1(a) Executive Employment Contract dated as of February 13, 2020, between Sensient Technologies Corporation and Paul Manning Exhibit 10.1 to Current Report on Form 8-K dated February 13, 2020 (Commission File No. 1-7626) 10.1(b) Form of Change of Control Employment and Severance Agreement Exhibit 10.1(b)(3) to…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
Q2 FY2026 earnings release, April 2026 · FY2025 10-K, accession 0000105132-25-000067