Clorox (CLX) AI Stock Analysis

• Market Cap: $19.27B
• Dividend Yield: 3.12%
• Average Volume (3M): 1.53M
• Price to Earnings (P/E): 42.7
• Beta (1Y): 0.38
• Revenue Growth: -1.98%
• EPS Growth: 474.83%
• Country: US
• Employees: 8,000
• Sector: Consumer Defensive
• Sector Strength: 73
• Industry: Consumer Products - Household & Personal
• EPS (TTM): 3.66
• Shares Outstanding: 123,189,865
• 10 Day Avg. Volume: 1,531,944
• 30 Day Avg. Volume: 1,525,576
• PEG Ratio: 0.09
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.69
• Price to Cash Flow (P/CF): 26.80
• P/FCF Ratio: 24.30
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $163.36
• Price Target Upside: 8.35% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 14

Clorox's overall score reflects its strong operational efficiency and cash flow generation, but high financial leverage and negative equity remain key risks. The positive sentiment from its earnings call and strategic initiatives, such as margin recovery and the Glad business acquisition, are promising. However, technical indicators suggest limited momentum, and the high P/E ratio points to potential overvaluation.

Positive Factors

Earnings

CLX reported another EPS beat in Q2, and essentially maintained FY guidance ex ERP timing, a positive in a group with negative EPS revisions.

Market Share

Clorox gained market share in seven of their eight categories due to strong innovation, especially in the trash bags, bleach, and the Kingsford business.

Negative Factors

Sales Growth

CLX's Household segment fell short of expectations, with organic sales down -11%.

Clorox Business Overview & Revenue Model

Company Description

The Clorox Company (CLX) is a global manufacturer and marketer of consumer and professional products, with its headquarters located in Oakland, California. Founded in 1913, the company is renowned for its flagship bleach product, Clorox, but has expanded its portfolio to include a wide array of household and professional cleaning products, health and wellness solutions, and lifestyle brands. Clorox operates across various sectors, including cleaning, household, lifestyle, and international business, with products available in over 100 countries.

How the Company Makes Money

Clorox generates revenue primarily through the sale of its diverse range of consumer and professional products. The company's revenue model is centered around four main segments: Cleaning, Household, Lifestyle, and International. The Cleaning segment includes products such as laundry additives, disinfecting wipes, and all-purpose cleaners. The Household segment covers items like charcoal, cat litter, and food storage solutions. The Lifestyle segment consists of food products, water filtration systems, and dietary supplements. The International segment includes products sold outside the United States. Clorox also benefits from strong brand recognition, strategic marketing, and distribution partnerships, which help maintain its market presence and drive sales across different regions.

Clorox Financial Statement Overview

Summary

Clorox demonstrates strong operational efficiency and cash flow generation, but faces challenges with high leverage and negative equity. The company must address its balance sheet weaknesses to ensure long-term financial health while continuing to capitalize on its operational strengths.

Income Statement

The income statement shows a mixed performance. The TTM gross profit margin is impressive at 44.53%, indicating strong cost management. The net profit margin is moderate at 6.38%, reflecting some challenges in controlling expenses beyond cost of goods. Revenue growth has fluctuated, with a recent TTM increase to $7.165 billion from $7.093 billion, but a decline from $7.389 billion the prior year. The EBIT margin of 17.8% suggests good operational efficiency, and the EBITDA margin of 15.1% highlights healthy earnings before accounting for interest, taxes, depreciation, and amortization.

Balance Sheet

The balance sheet presents some concerns. The debt-to-equity ratio is effectively negative due to a negative stockholders' equity of -$41 million, primarily due to high liabilities. Return on equity is not applicable due to negative equity, and the equity ratio is negative, indicating more liabilities than assets. These factors suggest high financial leverage, posing a potential risk for financial stability.

Cash Flow

Cash flow analysis reflects robust operations. The TTM operating cash flow to net income ratio is strong at 2.02, demonstrating effective cash generation from operations relative to net income. Free cash flow to net income ratio is 1.52, indicating healthy free cash flow generation. Although there was a decline in free cash flow from $930 million to $695 million, the company still maintains a solid cash flow position.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
7.17B	7.09B	7.39B	7.11B	7.34B	6.72B
	Gross Profit
3.19B	3.05B	2.91B	2.54B	3.20B	3.06B
	EBIT
1.27B	916.00M	1.22B	489.00M	1.12B	1.10B
	EBITDA
967.00M	736.00M	577.00M	928.00M	1.20B	1.46B
	Net Income Common Stockholders
457.00M	280.00M	149.00M	462.00M	710.00M	939.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
202.00M	202.00M	367.00M	183.00M	319.00M	871.00M
	Total Assets
5.75B	5.75B	5.95B	6.16B	6.33B	6.21B
	Total Debt
2.90B	2.90B	2.92B	3.10B	3.17B	3.12B
	Net Debt
2.70B	2.70B	2.56B	2.92B	2.85B	2.25B
	Total Liabilities
5.26B	5.26B	5.56B	5.43B	5.74B	5.30B
	Stockholders Equity
328.00M	328.00M	220.00M	556.00M	411.00M	908.00M
Cash Flow		Free Cash Flow
695.00M	483.00M	930.00M	535.00M	945.00M	1.29B
	Operating Cash Flow
923.00M	695.00M	1.16B	786.00M	1.28B	1.55B
	Investing Cash Flow
-84.00M	-175.00M	-223.00M	-229.00M	-452.00M	-252.00M
	Financing Cash Flow
-897.00M	-655.00M	-753.00M	-689.00M	-1.39B	-523.00M

Clorox Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 150.77
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CLX, the sentiment is Negative. The current price of 150.77 is below the 20-day moving average (MA) of 151.26, below the 50-day MA of 156.28, and above the 200-day MA of 150.39, indicating a neutral trend. The MACD of -0.42 indicates Negative momentum. The RSI at 44.38 is Neutral, neither overbought nor oversold. The STOCH value of 52.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CLX.

Clorox Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PG	80 Outperform	$406.08B	27.59	30.25%	2.29%	0.49%	5.02%
CHD	74 Outperform	$27.35B	46.91	13.42%	1.03%	4.08%	-22.34%
HENKY	74 Outperform	$35.26B	17.32	6.62%	1.68%	-1.29%	36.00%
KMB	71 Outperform	$47.10B	18.80	302.98%	3.40%	-1.83%	45.13%
CLX	65 Neutral	$19.27B	42.74	-1114.63%	3.12%	-1.98%	474.83%
Sector *	63 Neutral	$20.85B	13.27	-10.88%	7.48%	1.13%	11.50%
REYN	63 Neutral	$5.01B	14.26	16.43%	3.73%	-1.65%	18.38%

Clorox Corporate Events

Clorox Reports Q2 Sales Drop, Plans Glad Acquisition

Clorox reported a 15% decrease in net sales for Q2 of fiscal year 2025, mainly due to the aftermath of an August 2023 cyberattack and previous business divestitures. Despite the sales drop, gross margins slightly increased, and diluted EPS saw significant growth due to cost savings and insurance recoveries. The company plans to fully acquire P&G’s stake in the Glad joint venture by January 2026, aligning with its strategy to drive growth through innovation and improved operational models. Clorox also updated its fiscal 2025 outlook, expecting net sales to vary slightly and gross margins to increase, supported by improved margin management and lower input costs.

Clorox Announces CFO Transition for Future Growth

The Clorox Company announced that Kevin Jacobsen, their Chief Financial Officer, will retire on April 1, 2025, after nearly 30 years with the company. Jacobsen has been pivotal in driving the company’s IGNITE strategy and achieving strong financial results. Luc Bellet, currently Clorox’s Vice President and Treasurer, will succeed Jacobsen as CFO. Bellet, who has been with Clorox since 2006, is expected to continue driving the company’s growth, particularly in its digital transformation efforts. The transition is seen as a testament to Clorox’s effective succession planning and is anticipated to enhance long-term shareholder value.