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 36% below its 1 year high, and also trading at a PS multiple which is below the average for the last 3 years. However, it has strong margins to go with its modest valuation.

Clorox’s stock performance reflects a significant impact from its U.S. ERP transition. Q1 fiscal year 2026 net sales decreased 19% and gross margin fell 410 basis points as retailers drew down inventory built pre-transition. Despite this recent headwind, the company delivered ten consecutive quarters of gross margin expansion via cost savings and strategic pricing initiatives, with fiscal year 2025 organic sales growth projected at 4% to 5%. Portfolio streamlining through Argentina and VMS business divestitures positions Clorox for future profitable growth.

Let’s talk numbers

• Revenue Growth: -9.3% LTM and -1.1% last 3 year average. Not ideal, but this is a margin and value play.
• Strong Margin: Nearly 12.6% 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 16.3

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.

The question isn’t where CLX stock goes, but how your portfolio is positioned. See how Trefis High Quality Portfolio and our asset allocation strategy of our Boston-based, wealth management partner prepare you.

*LTM: Last Twelve Months

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
• Strategy consistent across market cycles.

There is no guarantee that the market will always reward such value stocks, so useful to ask – what is the risk?

Risk Quantified

CLX isn’t immune to sharp drops. It fell over 54% in the Dot-Com Bubble and about 44% during the Inflation Shock. The Global Financial Crisis knocked it down nearly 29%, while the 2018 Correction and Covid Pandemic still caused dips of 23% and 18%, respectively. Even solid stocks like CLX can take a hit when sell-offs hit hard. Past dips remind us that no name is completely safe.

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.