The Clorox Company (CLX) | Investment Case

1. Company Snapshot

1.a. Company Description

The Clorox Company manufactures and markets consumer and professional products worldwide.It operates through four segments: Health and Wellness, Household, Lifestyle, and International.The Health and Wellness segment offers cleaning products, such as laundry additives and home care products primarily under the Clorox, Clorox2, Scentiva, Pine-Sol, Liquid-Plumr, Tilex, and Formula 409 brands; professional cleaning and disinfecting products under the CloroxPro and Clorox Healthcare brands; professional food service products under the Hidden Valley brand; and vitamins, minerals and supplement products under the RenewLife, Natural Vitality, NeoCell, and Rainbow Light brands in the United States.

The Household segment provides cat litter products under the Fresh Step and Scoop Away brands; bags and wraps under the Glad brand; and grilling products under the Kingsford brand in the United States.The Lifestyle segment offers dressings, dips, seasonings, and sauces primarily under the Hidden Valley brand; natural personal care products under the Burt's Bees brand; and water-filtration products under the Brita brand in the United States.The International segment provides laundry additives; home care products; water-filtration systems; digestive health products; grilling products; cat litter products; food products; bags and wraps; natural personal care products; and professional cleaning and disinfecting products internationally primarily under the Clorox, Ayudin, Clorinda, Poett, Pine-Sol, Glad, Brita, RenewLife, Ever Clean and Burt's Bees brands.

The Clorox Company sells its products primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet and military stores; third-party and owned e-commerce channels; and distributors, as well as a direct sales force The company was founded in 1913 and is headquartered in Oakland, California.

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1.b. Last Insights on CLX

The Clorox Company's recent performance has been negatively impacted by several factors. The company's ERP transition, inventory reductions, and macro headwinds have weighed on sales and margins. Organic sales fell 17% year-over-year in Q1 2026, primarily due to the ERP-related disruption. Underlying consumption has also been weak, with below-usual category growth and competitive pressure from lower-cost substitutes. Additionally, the company faces growth headwinds and stagnation, trading at a premium to industry peers. (Source: CLX Q1 Earnings Preview, CLX Q1 Earnings Beat Estimates)

1.c. Company Highlights

Last Price	104.9
Change Percentage	-0.19%
Open	104.71
Previous Close	105.1
Market Cap ( Millions)	12796
Volume	1378822
Year High	171.37
Year Low	98.2
M A 50	112.62
M A 200	127.65

FCF Yield	4.97%
Dividend Yield	4.69%
ROE	1110.18%
Debt / Equity	-13990.91%
Net Debt / EBIDTA	218.62%
Price To Book	-584.72
Price Earnings Ratio	16.26
Price To FCF	20.12
Price To sales	1.89
EV / EBITDA	11.79

2. The Clorox Company: A Resilient Performance Amidst Challenges

The Clorox Company reported a Q1 Fiscal Year 2026 earnings release with an EPS of $2.87, beating estimates of $2.2. The company's financial performance was marked by a mix of challenges and successes, with the successful launch of their new ERP system being a significant highlight. However, the transition presented some challenges, and the team's resilience and adaptability allowed them to navigate them effectively. Revenue growth was impacted by the ERP transition, with organic sales growth in the front half expected to be in negative low single digits, while the back half is expected to see positive low single digits growth.

Publication Date: Nov -09

                                    📋 Highlights
                                    ERP Transition Impact::
                                                Adjusted inventory headwinds from ERP transitions refined to 7.5 point estimate, up from 7-8 points previously.
Sales Growth Outlook::
                                                Front half organic growth at negative low single digits (-1% to -2%), back half expected to recover to positive low single digits (+1% to +2%).
Gross Margin Pressure::
                                                Input cost inflation to rise by $70 million, offset by ERP efficiency gains and disciplined trade spending.
Market Share Challenges::
                                                ERP ramp-up caused short-term share erosion, but long-term plans target recovery via innovation and portfolio discipline.
Innovation Pipeline::
                                                $0.90 earnings run rate boost expected in FY2026, driven by demand creation and real-time ERP-enabled supply chain visibility.

                                

Gross Margin Outlook

The gross margin outlook is expected to be impacted by inflation, with input cost and inflation increasing by $70 million. However, the company expects to see robust gross margin expansion in both Q3 and Q4, driven by the fundamentals of their business remaining very strong. As Luc Bellet mentioned, "inflation is expected to remain moderate," and the company is working to mitigate its impact.

Innovation and Growth

The company has a robust pipeline of innovation, with plans to launch major innovations in key businesses, including successful scent platforms like Bahama Bliss and a new foul scent for Glad. The Brita brand is also modernizing its pitchers with new colors and price pack architecture. These innovations are expected to drive growth and help the company recover market share.

Valuation Metrics

Using the current valuation metrics, the company's P/E Ratio stands at 16.64, indicating a relatively reasonable valuation. The EV/EBITDA ratio is 11.07, suggesting a moderate valuation. The Dividend Yield is 4.58%, providing a relatively attractive return for investors. With analysts estimating next year's revenue growth at -7.8%, the current valuation may be pricing in some of the challenges the company is facing.

Operational Efficiency

The company's new ERP system has strengthened their digital backbone and unlocks new value streams. As Linda Rendle noted, "our new ERP system gives us real-time visibility and enhances demand planning, enabling us to rebuild growth momentum and deliver superior value experiences with our brands." This improved operational efficiency is expected to drive growth and improve profitability.

3. NewsRoom

Groupe la Francaise Takes Position in The Clorox Company $CLX

Dec -04

Source: defenseworld.net

The Clorox Company (CLX) Presents at Morgan Stanley Global Consumer & Retail Conference 2025 Transcript

Dec -02

Source: seekingalpha.com

Clorox: A Dividend Champion Facing Headwinds, But Still A Buy

Dec -02

Source: seekingalpha.com

THE COLLAB WE'VE ALL BEEN WAITING FOR: GLAD DROPS TRASH-FILLED MUSICAL NUMBER STARRING OSCAR THE GROUCH

Dec -02

Source: prnewswire.com

My 3 Favorite Stocks to Buy Right Now

Nov -30

Source: fool.com

Best Dividend Aristocrats For December 2025

Nov -29

Source: seekingalpha.com

Humana (NYSE:HUM) Stock Acquired Rep. Lisa C. McClain

Nov -27

Source: defenseworld.net

Rep. Lisa C. McClain Sells Spire Inc. (NYSE:SR) Stock

Nov -27

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.26%)

6. Segments

Health and Wellness

Expected Growth: 2.5%

The 2.5% growth in Health and Wellness segment of The Clorox Company is driven by increasing consumer focus on healthy living, rising demand for nutritional supplements, and expansion of e-commerce channels. Additionally, the company's strategic acquisitions and product innovations in the vitamins and supplements space have contributed to the growth.

Household

Expected Growth: 1.8%

The 1.8% growth in Clorox's Household segment is driven by increasing demand for cleaning and disinfecting products, particularly in the wake of the pandemic. Additionally, the company's focus on innovation, such as the introduction of new product lines and scents, has helped to drive sales. Furthermore, Clorox's strong brand recognition and distribution network have enabled the company to maintain its market share and capitalize on growth opportunities.

Lifestyle

Expected Growth: 2.2%

The 2.2% growth in Lifestyle segment of The Clorox Company is driven by increasing demand for premium and sustainable products, particularly in the cat litter and charcoal businesses. Additionally, the company's focus on innovation, brand renovation, and e-commerce expansion are contributing to the segment's growth.

International

Expected Growth: 2.8%

The 2.8% international growth of The Clorox Company is driven by increasing demand for its cleaning and disinfecting products, particularly in emerging markets. Expansion into new geographies, strategic partnerships, and effective supply chain management also contribute to this growth. Additionally, the company's focus on innovation and product diversification helps to drive sales and revenue in international markets.

Corporate and Other

Expected Growth: 1.5%

The 1.5% growth in Corporate and Other segment of The Clorox Company is driven by increased demand for water filtration systems, expansion of the company's digital platform, and cost savings initiatives. Additionally, strategic investments in e-commerce and innovation are expected to contribute to the segment's growth.

7. Detailed Products

Bleach

A strong disinfectant used for cleaning and sanitizing surfaces

Pine-Sol

A multi-purpose cleaner used for cleaning and disinfecting surfaces

Glad Trash Bags

A line of trash bags used for waste management

Kingsford Charcoal

A line of charcoal products used for outdoor grilling and barbecuing

Brita Water Filters

A line of water filtration systems used for purifying drinking water

Liquid-Plumr

A line of drain cleaning products used for unclogging drains

POETT Home Care

A line of home care products used for cleaning and organizing

Tilex

A line of mold and mildew removers used for cleaning and disinfecting

8. The Clorox Company's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Clorox is moderate due to the presence of alternative cleaning products and personal care items from other manufacturers.

Bargaining Power Of Customers

The bargaining power of customers is low for Clorox as the company has a diverse customer base and no single customer accounts for a significant portion of its revenue.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for Clorox as the company relies on a few key suppliers for raw materials, but has some flexibility to negotiate prices.

Threat Of New Entrants

The threat of new entrants is low for Clorox as the company has a strong brand presence and significant barriers to entry in the cleaning products and personal care industries.

Intensity Of Rivalry

The intensity of rivalry is high for Clorox as the company operates in a highly competitive market with several established players, leading to intense competition for market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	93.00%
Debt Cost	4.55%
Equity Weight	7.00%
Equity Cost	6.08%
WACC	4.66%
Leverage	1329.09%

11. Quality Control: The Clorox Company passed 4 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Inter Parfums

A-Score: 5.9/10

Value: 4.9

Growth: 8.1

Quality: 8.1

Yield: 5.0

Momentum: 2.5

Volatility: 7.0

1-Year Total Return ->

Clorox

A-Score: 5.3/10

Value: 4.0

Growth: 3.9

Quality: 6.5

Yield: 7.0

Momentum: 1.0

Volatility: 9.7

1-Year Total Return ->

e.l.f. Beauty

A-Score: 4.4/10

Value: 0.8

Growth: 9.6

Quality: 7.1

Yield: 0.0

Momentum: 7.0

Volatility: 2.0

1-Year Total Return ->

Newell Brands

A-Score: 3.9/10

Value: 7.8

Growth: 1.4

Quality: 1.9

Yield: 9.0

Momentum: 1.0

Volatility: 2.0

1-Year Total Return ->

Helen of Troy

A-Score: 3.0/10

Value: 9.5

Growth: 3.0

Quality: 3.1

Yield: 0.0

Momentum: 0.0

Volatility: 2.3

1-Year Total Return ->

Coty

A-Score: 2.8/10

Value: 6.4

Growth: 3.1

Quality: 2.8

Yield: 0.0

Momentum: 0.5

Volatility: 4.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-3.96%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

4.66%

The Clorox Company - US1890541097

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on CLX

1.c. Company Highlights

Expensive

Higher Yield

Medium Volatility

Earnings Beats

Revenues Miss

Average Yield

Lower Growth

Weak Momentum

Strong Momentum

Revenues Beats

Less Volatile

Better Quality

Earnings Miss

Fairly Valued

Stable Momentum

2. The Clorox Company: A Resilient Performance Amidst Challenges

Gross Margin Outlook

Innovation and Growth

Valuation Metrics

Operational Efficiency

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.26%)

6. Segments

Health and Wellness

Expected Growth: 2.5%

Household

Expected Growth: 1.8%

Lifestyle

Expected Growth: 2.2%

International

Expected Growth: 2.8%

Corporate and Other

Expected Growth: 1.5%

7. Detailed Products

Bleach

Pine-Sol

Glad Trash Bags

Kingsford Charcoal

Brita Water Filters

Liquid-Plumr

POETT Home Care

Tilex

8. The Clorox Company's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: The Clorox Company passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

12.e Scoring ^Insights

12.f DCF ^BETA