Does Insider Buying Signal Value in the WD-40 Company?

Insider buying at the WD-40 Company (NASDAQ: WDFC) signals value, as the stock trades near its long-term lows and at the low end of its historical price-to-earnings (P/E) range. While its 32x current-year earnings is a premium price, it reflects a solid outlook for steady top-line growth, margin improvement, accelerated earnings growth, cash flow, and capital returns.

Capital return is a critical factor for this company’s stock price outlook and value proposition, because its dividend is healthy and attractive, increases annually, and share buybacks are back on the table. 

The company’s buybacks were suspended in 2020 due to the COVID-19 pandemic, but were reinstated in 2023 at a reduced pace compared to prior levels. Among the critical details from the F2025 year-end report is that margin and cash flow improvements increased management’s confidence, allowing them to accelerate the pace of buybacks.

What this means for investors is a strengthening tailwind for this stock, which is tightly held and likely to advance over the coming quarters and years. Regarding the value, the company's target 5% to 9% growth pace has this stock trading below 20x earnings by 2030 and in the low teens by 2035. 

Insiders, Institutions, and Analysts Buy WDFC Stock in the Back Half of 2025

The insider activity is noteworthy. InsiderTrades tracked six purchases from six insiders within days of the year-end report and each other. Buyers included three directors, the CEO, the CFO, and a VP. The purchases are small, amounting to less than 0.02% of the company's value, but show broad-based support from a group that already had a stake in the game.

Total holdings are approximately 0.78% of the stock and are compounded by a robust institutional interest. 

The institutional data reflects market rotation along with robust market support. The institutional activity in 2025 spiked to multi-year highs, with sellers outpacing buyers in H1, when share prices were higher, and then reverted to buyers outpacing sellers in H2, when prices were low.

The critical takeaway is that institutions own more than 91% of the stock, providing a solid support base with shares near historical lows. It is unlikely the market will significantly fall below the late-October/early-November lows with this dynamic in place. The Q4 results were solid, bolstering the outlook, and the 2026 guidance was sufficient to sustain cash flow and capital returns. 

Highlights from F2025 include moderate mid-single-digit revenue growth, expanding gross and operating margins, a recovery in gross margin to historical norms a year ahead of expectations, and positive cash flow despite paying dividends, increasing distributions, share buybacks, and debt reduction. The balance sheet details include increased cash, current, and total assets, compounded by reduced debt and liabilities, resulting in a 16% increase in equity.

Regarding equity and leverage, the approximately $268 million in shareholder equity is nearly 3x the debt, resulting in a leverage ratio of 0.3x long-term debt and approximately 1.1x total liabilities. 

Analysts' Coverage Is Tepid, But Very Bullish on WDFC Stock

The analyst coverage of WDFC stock is tepid, with only two current reports tracked by InsiderTraders. The upshot is that both were issued in the second half of 2025, making them relatively fresh, and the takeaways are bullish. The consensus is a Moderate Buy, comprising one Hold and one Buy rating, with a price target of $300. That equates to a 50% stock price gain from the critical support levels and may be reached within the next 12 months. 

The chart action is mixed. The stock is in a downtrend and has not yet confirmed a bottom or reversal, but it appears to be on the brink of doing so. The late-October/early-November action reflects support, and indicators are set up to fire a reasonably strong buy signal.

The question is whether WDFC’s market will move above the critical resistance point, which is also close at hand. That level is near $205 for this consumer stock.

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The article "Does Insider Buying Signal Value in the WD-40 Company?" first appeared on MarketBeat.