Big Moat Stocks (formerly Rule 1 Numbers)

Fastenal has several executives who have been with the company for quite some time and have been promoted from within. The Chairman of the Board, Robert Kierlin, is the founder of the company. This is all very positive for investors because having management with this type of history with the company lends itself to having their interests aligned with the shareholders interests.

Executive compensation for Fastenal management is actually lower than a lot of its competitors. The history has shown that Fastenal has always had one of the lowest CEO salaries for quite some time. In 2004, Kierlin’s bonus as CEO was dropped from $121,500 to $71,214 even though the stock price was up more than $17 from the start of 2003.

The one thing I couldn’t find when doing my research is what big-moat likes to call the “Big Audacious Goal” (BAG) of Fastenal. The CEO references their commitment to improve the customer’s experience but this is the goal of every company in this industry. To sustain the growth they have had in the past and to take market share from competitors, I want to see something different than what everyone else is doing.

Willard D. Oberton - President and CEO
2005 Compensation: $1,116,188 ($353,000 Salary, $761,148 Bonus)

Mr. Oberton has served as a director of the Company since June 1999, has been President of the Company since July 2001, and has been Chief Executive Officer of the Company since December 2002. Mr. Oberton also served as Chief Operating Officer of the Company from March 1997 through December 2002, as Executive Vice President of the Company from June 2000 through July 2001, and as Vice President of the Company from March 1997 through June 2000.

bio from Fastenal.com

Nicholas J. Lundquist - Executive Vice-President and COO
2005 Compensation: $1,116,188 ($300,000 Salary, $633,490Bonus)

Mr. Lundquist has worked for Fastenal since 1979. Starting out as a Trainer in Winona, he moved on to be the Assistant Branch Manager in Madison. In 1980, Mr. Lundquist served as Branch Manager in Minneapolis, Beloit, and Indianapolis. Mr. Lundquist then served as Hub Manager in Indianapolis and Hub Manager in Winona. Mr. Lundquist served as Regional Manager from 1991 to 1997 when he became Fastenal Sales Manager. In 2001, he became the executive Vice-President of Sales and Chief Operating Officer.

bio from Fastenal.com

Robert A. Kierlin - Chairman

Mr. Kierlin has been the Chairman of the Board of the Company and has served as a director of the Company since the Company’s incorporation in 1968. In addition, Mr. Kierlin has served as a Minnesota State Senator since April 1999. Mr. Kierlin served as Chief Executive Officer of the Company from 1968 through December 2002, and as President of the Company from 1968 through July 2001.

bio from Fastenal.com