Clorox (CLX) Downgraded to Sell at Zacks Investment Research

Zacks Investment Research lowered shares of Clorox (NYSE:CLX) from a hold rating to a sell rating in a report published on Monday morning.

According to Zacks, “Clorox trimmed its earnings guidance for fiscal 2019 despite solid first-quarter results. This was mainly due to the expectations of making fewer share repurchases in fiscal 2019 than repurchases of nearly 50% of its $2-billion authorization, guided earlier. Adverse currency translations hurt the top-line growth and remain concerns in fiscal 2019. The company is also witnessing strained margins owing to higher commodity and logistics expenses, which is likely to persist in the fiscal year. However, the stock has outperformed the industry in the past three months. In first-quarter fiscal 2019, the company marked eighth consecutive positive earnings surprise and fourth sales beat in the last six quarters. Earnings gained from lower tax rate, and higher sales and cost savings, while the Nutranext acquisition and higher volumes aided sales. Moreover, its 2020 Strategy, aimed at bolstering growth at various categories and market share, is encouraging.”

Several other brokerages also recently commented on CLX. Citigroup lifted their price target on Clorox from $153.00 to $169.00 and gave the stock a hold rating in a research report on Tuesday, November 20th. Barclays set a $138.00 price objective on Clorox and gave the stock a hold rating in a report on Thursday, November 1st. BMO Capital Markets lifted their price objective on Clorox from $153.00 to $165.00 and gave the stock a buy rating in a report on Friday, November 2nd. Wells Fargo & Co reissued a hold rating on shares of Clorox in a report on Wednesday, October 31st. Finally, ValuEngine raised Clorox from a hold rating to a buy rating in a report on Saturday, September 22nd. Five analysts have rated the stock with a sell rating, seven have assigned a hold rating and three have assigned a buy rating to the company’s stock. The company has a consensus rating of Hold and an average price target of $144.93.

Shares of NYSE CLX opened at $163.76 on Monday. The company has a current ratio of 1.07, a quick ratio of 0.65 and a debt-to-equity ratio of 3.38. The company has a market capitalization of $20.89 billion, a price-to-earnings ratio of 26.16, a price-to-earnings-growth ratio of 4.02 and a beta of 0.30. Clorox has a 12 month low of $113.57 and a 12 month high of $167.70.

Clorox (NYSE:CLX) last issued its quarterly earnings results on Wednesday, October 31st. The company reported $1.62 EPS for the quarter, topping the Thomson Reuters’ consensus estimate of $1.59 by $0.03. The company had revenue of $1.56 billion for the quarter, compared to the consensus estimate of $1.53 billion. Clorox had a return on equity of 102.65% and a net margin of 13.59%. The company’s revenue for the quarter was up 4.2% on a year-over-year basis. During the same period in the previous year, the business posted $1.46 EPS. On average, research analysts forecast that Clorox will post 6.31 earnings per share for the current fiscal year.

The company also recently disclosed a quarterly dividend, which will be paid on Friday, February 8th. Stockholders of record on Wednesday, January 23rd will be issued a dividend of $0.96 per share. This represents a $3.84 annualized dividend and a dividend yield of 2.34%. The ex-dividend date is Tuesday, January 22nd. Clorox’s payout ratio is presently 61.34%.

In other news, SVP Diego J. Barral sold 12,880 shares of Clorox stock in a transaction that occurred on Tuesday, November 6th. The stock was sold at an average price of $157.98, for a total transaction of $2,034,782.40. Following the sale, the senior vice president now owns 18,603 shares of the company’s stock, valued at approximately $2,938,901.94. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, SVP Michael R. Costello sold 6,882 shares of Clorox stock in a transaction that occurred on Thursday, November 15th. The stock was sold at an average price of $160.08, for a total value of $1,101,670.56. The disclosure for this sale can be found here. Insiders have sold a total of 239,901 shares of company stock worth $38,967,571 in the last three months. 1.40% of the stock is owned by insiders.

A number of hedge funds have recently made changes to their positions in CLX. Morgan Stanley boosted its stake in Clorox by 178.2% in the 3rd quarter. Morgan Stanley now owns 3,063,813 shares of the company’s stock valued at $460,828,000 after buying an additional 1,962,433 shares in the last quarter. Macquarie Group Ltd. boosted its stake in Clorox by 437,400.0% in the 2nd quarter. Macquarie Group Ltd. now owns 1,750,000 shares of the company’s stock valued at $236,688,000 after buying an additional 1,749,600 shares in the last quarter. Schroder Investment Management Group boosted its stake in Clorox by 57.0% in the 2nd quarter. Schroder Investment Management Group now owns 1,506,358 shares of the company’s stock valued at $201,641,000 after buying an additional 547,070 shares in the last quarter. FMR LLC boosted its stake in Clorox by 201.0% in the 2nd quarter. FMR LLC now owns 472,179 shares of the company’s stock valued at $63,863,000 after buying an additional 315,298 shares in the last quarter. Finally, DekaBank Deutsche Girozentrale boosted its stake in Clorox by 110.5% in the 3rd quarter. DekaBank Deutsche Girozentrale now owns 427,013 shares of the company’s stock valued at $61,991,000 after buying an additional 224,143 shares in the last quarter. 77.96% of the stock is currently owned by institutional investors and hedge funds.

Clorox Company Profile

The Clorox Company manufactures and markets consumer and professional products worldwide. It operates through four segments: Cleaning, Household, Lifestyle, and International. The company offers laundry additives, including bleach products under the Clorox brand, as well as Clorox 2 stain fighter and color booster; home care products primarily under the Clorox, Formula 409, Liquid-Plumr, Pine-Sol, S.O.S, and Tilex brands; naturally derived products under the Green Works brand; and professional cleaning, disinfecting, and food service products under the Clorox, Dispatch, HealthLink, Clorox Healthcare, Hidden Valley, KC Masterpiece, and Soy Vay brands.

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