WD-40 Company: A Conflicted Story

Dec. 05, 2018 11:56 AM ETWD-40 Company (WDFC)12 Comments
Matt Evans profile picture
Matt Evans
68 Followers

Summary

  • Well managed company with a great global vision.
  • Recognizable brand and versatile product with more in the pipeline.
  • Value and price can sometimes be a very different thing.

Introduction

I can remember my first time using a can of WD-40. I was probably 10 or 11 years old and I had gotten a ton of dirt on the chain of my bicycle. It caused all sorts of nasty sounds when I rode it and I knew that I had to get it fixed or bad things were going to happen. Just by sheer luck I happened to grab a can that my dad had laying around on his workbench and sprayed it all over the chain, cleaning it right up. I felt super proud of my accomplishment and felt a lot smarter than I actually was, especially since this was never the intended use of WD-40. In fact it was really intended to be used by aerospace contractor Convair to protect the outer shell of the Atlas Missile from rusting. As it turns out there are over 2,000 different uses of WD-40, one of which I just recently had to use as one of my little ones decided to put crayons in the dryer without me knowing (worked really well for what it's worth). So I was delighted to see that they were a publicly traded company and thought this would be a great opportunity to buy a well known and valuable brand. This is where the the story becomes conflicting and I have to make sure that as an investor, I must maintain discipline.

The Good: A Brand With Value

WD-40 is a powerful brand and it shows its sticking power as it is estimated since 1993 that 4 out of 5 households have at least one can of WD-40 and is used widely amongst professionals. While the formula hasn't deviated since its inception, there have been several innovations to the cans that are used to give us this

This article was written by

Matt Evans profile picture
68 Followers
I am an Electrical Engineer with a background in embedded systems, firmware and fiber optics. I enjoy the process of investing and want to share my thoughts and ideas. My goal is on long term investing and not to beat the market as I believe this can lead to short term focus and poor decision making. I do not have a specific sector I focus on but given my background my affinity will be more towards the tech side as that is what I understand best.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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