Is Clorox Stock Poised for a Rally?
Here is why we think Clorox (CLX) stock deserves consideration as a value stock. It is currently trading nearly 33% below its 1 year high, and also trading at a PS multiple which is below the average for the last 3 years. However, it is growing, even though modestly, and has strong margins to go with its low valuation.
- Revenue Growth: 0.2% LTM and 0.04% last 3 year average. Low growth, but this is a margin and value play.
- Strong Margin: Nearly 12.7% 3-year average operating margin.
- No Major Margin Shock: Clorox has avoided any large margin collapse in the last 12 months.
- Modest Valuation: Despite encouraging fundamentals, CLX stock trades at a PE multiple of 16.6
As a quick background, Clorox provides consumer and professional products globally across health, household, lifestyle, and international segments, primarily sold through mass retailers, grocery outlets, warehouse clubs, dollar stores, and hardware centers.
No matter where one stock goes, your portfolio should stay on track. See how High Quality Portfolio can help you do that.
| CLX | S&P Median | |
|---|---|---|
| Sector | Consumer Staples | – |
| Industry | Household Products | – |
| PE Ratio | 16.6 | 23.7 |
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| LTM* Revenue Growth | 0.2% | 5.6% |
| 3Y Average Annual Revenue Growth | 0.0% | 5.3% |
| LTM Operating Margin Change | 6.3% | 0.2% |
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| LTM* Operating Margin | 16.7% | 18.8% |
| 3Y Average Operating Margin | 12.7% | 18.2% |
| LTM* Free Cash Flow Margin | 10.7% | 13.4% |
*LTM: Last Twelve Months
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But do these numbers tell the full story? Read Buy or Sell CLX Stock to see if Clorox still has an edge that holds up under the hood.
Stocks Like These Can Outperform. Here Is Data
Below are statistics for stocks with same selection strategy applied between 12/31/2016 and 6/30/2025.
- Average 6-month and 12-month forward returns of 12.7% and 25.8% respectively
- Win rate (percentage of picks returning positive) of > 70% for both 6-month and 12-month periods
- Not over dependent on market crashes. During non-crash periods as well, this strategy has 12-month average return of nearly 20% with 67% win rate.
But Consider The Risk
That said, CLX isn’t immune to big drops. It plunged over 54% in the Dot-Com crash and nearly 44% during the inflation shock in 2022. The Global Financial Crisis hit it with a 29% dip, while the 2018 correction and Covid pullback saw declines around 23% and 18%, respectively. Even solid companies like CLX can take a hit when the market turns. Risk remains, no matter how strong the fundamentals.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.