WD-40 (WDFC) Stock Forecast & Price Target

WD-40 Company is projected to achieve significant sales growth, with an increase in pro forma FY25 sales estimates to +8.5%, marking the fifth consecutive fiscal year of 7% or higher top-line growth. The successful transition to direct distribution in Brazil has already yielded a $7 million increase in sales for FY24, with expectations for an additional $7 million to $9 million boost in FY25, indicating strong market performance in this region. Furthermore, the company has adjusted its FY25 earnings per share estimates upward by $0.13, highlighting improved profitability driven by a positive product mix and reduced petroleum-based specialty chemical costs, despite some pressure from logistics expenses.

WD-40 Company anticipates a decline in free cash flow for FY25 after a strong performance in FY24, with pro forma sales growth expectations lowered from 8% to 7% year-over-year, and a reduction in estimated earnings per share (EPS) by $0.05. The company is facing pressures on gross margins due to rising input costs, particularly from petroleum-based materials and tin plate for aerosol cans, which could negatively impact overall financial performance. Additionally, the reliance on distributor order timing, which has fluctuated significantly in previous quarters, raises concerns about the stability and predictability of revenues, particularly in key markets such as Indonesia, South Korea, and the Philippines.