The Clorox Company (CLX), based in Oakland, California, manufactures and markets consumer and professional products. Valued at $18.8 billion by market cap, the company's principal products include household cleaning and bleach products, charcoal, cat litter, dressings and sauces, natural personal care, and trash bags.
Shares of this consumer products giant have underperformed the broader market considerably over the past year. CLX has gained marginally over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 27.8%. In 2024 alone, CLX’s stock rose 5.6%, compared to the SPX’s 17.8% rise on a YTD basis.
Narrowing the focus, CLX has also lagged behind the Vanguard Consumer Staples Index Fund ETF Shares (VDC). The exchange-traded fund has gained about 13.1% over the past year. Moreover, the ETF’s 13.1% gains on a YTD basis outshine the stock’s single-digit returns over the same time frame.
CLX's grim price performance can be attributed to a less favorable price mix and reduced volumes, as well as the sale of the Argentina business. Additionally, higher costs, inflation, and increased trade promotional spending have also had a negative impact on their overall results. The anticipated divestiture of the Better Health VMS business has also impacted its performance recently.
However, on Aug. 1, CLX reported its Q4 earnings results, and its shares closed up more than 7% in the following trading session. Its adjusted EPS of $1.82 beat Wall Street expectations of $1.54. But, the company’s revenue was $1.9 billion, which fell short of Wall Street forecasts of $2 billion. CLX expects full-year adjusted EPS to be between $6.55 and $6.80.
For the current fiscal year, ending in June, analysts expect Clorox’s EPS to grow 6.3% to $6.56 on a diluted basis. The company’s earnings surprise history is solid. It beat the consensus estimate in each of the last four quarters.
Among the 19 analysts covering CLX stock, the consensus is a “Hold.” That’s based on 14 “Hold” ratings and five “Strong Sells.”
On Aug. 2, Wells Fargo & Company (WFC) analyst Christopher Carey maintained a “Sell” rating on CLX with a price target of $135.
While CLX currently trades above its mean price target of $144.50, the Street-high price target of $155 suggests an upside potential of 2.9%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
