The Clorox Company (CLX) $101.14
Clorox, a staple in defensive portfolios, has shed nearly 30% from its 52-week high, raising urgent questions about its current valuation and whether its recent plunge offers a compelling entry point.
52-wk High $143.96
π Investment Snapshot
- π° Trading at $101.14, CLX carries a 16.55x P/E, a discount to the broader market and many peers.
- π Latest quarter saw $1.67B in revenue and $1.29 EPS, indicating a mixed performance trend.
- π A robust 4.90% dividend yield and active buybacks provide a floor for this defensive play amidst market volatility.
- π― Analysts maintain a ‘Hold’ consensus, projecting a mean target of $122.06, suggesting over 20% upside.
CLX currently sits near its 52-week lows, with an RSI screaming oversold and a strong bearish trend confirmed by ADX. While the dividend yield and analyst upside are attractive, the stock has not yet established a clear support base for a high-conviction entry.
| π Entry Zone | $98.00 or below | π Stop-Loss | $95.00 |
| π Adjust If | CLX reclaims the $105.00 level with sustained volume, signaling a potential reversal of the short-term downtrend. | ||
The Investment Case β Why Now?
Clorox has experienced a significant downturn over the past month, plunging over 20% and pushing the stock into deeply oversold territory. This sharp correction follows a period of volatile earnings and persistent macro headwinds, leaving investors questioning the stability of this traditionally defensive name.
The primary risk to a bullish thesis remains the ongoing pressure on consumer spending and potential for sustained input cost inflation. Should the company struggle to pass on higher costs or see further erosion in market share, its earnings power could face continued compression, challenging its premium valuation and dividend sustainability.
π€ Given the current macro environment, can Clorox effectively defend its pricing power and market share, or will competitive pressures force further margin contraction?
π’ Company Overview
| Detail | Value |
|---|---|
| Company | The Clorox Company |
| Ticker / Exchange | CLX / NYSE |
| Sector / Industry | Consumer Defensive / Household & Personal Products |
| CEO | Linda J. Rendle |
| Founded / HQ |
π Price Action & Technicals
Dead Cross
Inside VA
A buy-side sweep at $108.94 on March 12, 2026, failed to sustain upward momentum, quickly followed by further price declines.
Clorox’s price action paints a clear picture of a stock in a pronounced downtrend. It trades significantly below both its 50-day and 200-day Simple Moving Averages, which now act as formidable resistance levels. The current price also hovers near the lower Bollinger Band, indicating extreme short-term weakness.
The Relative Strength Index (RSI) at 26.3 screams oversold, typically a precursor to a bounce, yet the MACD’s persistent bearish cross and the strong downtrend confirmed by an ADX of 52.2 with -DI dominating +DI suggest caution. This confluence of indicators signals that while a bounce is possible, the underlying trend remains firmly negative.
Price currently sits within the Value Area defined by the Volume Profile, but well below the Point of Control (POC) at $121.57, highlighting that most recent volume occurred at higher prices. The Anchored VWAP from late 2025 also sits nearly 10% above current price, reinforcing the bearish sentiment and indicating that the average institutional cost basis is much higher.
Volume has run 19% above its 20-day average, suggesting conviction behind the recent selling pressure. Multiple unfilled bearish Fair Value Gaps (FVGs) above the current price, notably between $104.82 and $111.36, could act as magnets for price should a relief rally materialize, but they also represent significant overhead supply.
β Peer P/E Comparison
| Ticker | Company | P/E (TTM) |
|---|---|---|
| CLX | The Clorox Company | 16.55x |
| PG | Procter & Gamble | 25.2x |
| CL | Colgate-Palmolive | 24.1x |
| KMB | Kimberly-Clark | 20.3x |
| S&P 500 | Index Average | 21.0x |
π° Earnings Deep Dive
| Period | Revenue | EPS | YoY |
|---|---|---|---|
| Q4 2025 | $1.67B | $1.29 | |
| Q3 2025 | $1.43B | $0.65 | |
| Q2 2025 | $1.99B | $2.68 | |
| Q1 2025 | $1.67B | $1.50 |
Clorox generated a healthy $0.3B in Free Cash Flow in the latest quarter, demonstrating operational efficiency. The company actively returned capital to shareholders, deploying $0.1B in buybacks during the same period, reinforcing its commitment to shareholder value.
π Growth Drivers β What Moves the Stock
- Brand Strength & Pricing Power π’ Upside Surprise β Clorox’s portfolio of household brands commands significant consumer loyalty, allowing for strategic price increases to offset inflation. This inherent pricing power remains a critical driver in a volatile economic climate.
- Defensive Sector Appeal π‘ Priced In β As a consumer defensive stock, Clorox often attracts capital during periods of economic uncertainty, offering stability and a reliable dividend yield. This defensive characteristic provides a fundamental floor for the stock.
π¦ Smart Money & Institutional Positioning
13F Holdings
| Institution | Shares (K) |
|---|---|
| Vanguard Group Inc | 15,684 |
| Blackrock Inc. | 10,303 |
| State Street Corporation | 8,424 |
| Invesco Ltd. | 4,880 |
| Geode Capital Management, LLC | 3,172 |
Holdings reflect most recent 13F (45-day lag).
Insider Transactions
| Name | Title | Date | Type | Shares |
|---|---|---|---|---|
| RENDLE LINDA J | Chief Executive Officer | Oct 3, 2025 | Purchase | 43,370 |
| REYNOLDS ERIC H | Chief Operating Officer | Oct 3, 2025 | Purchase | 15,489 |
| GRIER STACEY | Officer | Oct 3, 2025 | Purchase | 9,913 |
| HILT ANGELA CHRISTINE | Officer | Oct 3, 2025 | Purchase | 8,672 |
Short Interest
| Short % Float | Days to Cover |
|---|---|
| 0.1% | 3.7 |
β Key Risk Factors
Erosion of ~50-100bps in gross margin
Potential ~2-3% revenue growth deceleration
Operational costs increase by ~1-2%
Volume declines of ~1-3%
π€ With Clorox’s valuation now at a discount, does the market adequately price in these macro and competitive risks, or is there still further downside if these pressures intensify?
π― Guidance & Wall Street View
| High Target | Mean Target | Low Target | Analysts | Consensus |
|---|---|---|---|---|
| $163.0 | $122.06 | $94.0 | 17 | Hold |
| Firm | Rating | Target | Date | Action |
|---|---|---|---|---|
| Deutsche Bank | Hold | Mar 2026 | main | |
| Morgan Stanley | Equal-Weight | Feb 2026 | main | |
| UBS | Neutral | Feb 2026 | main | |
| Citigroup | Neutral | Feb 2026 | main | |
| JP Morgan | Neutral | Feb 2026 | main |
The analyst consensus leans heavily towards ‘Hold’ or ‘Neutral,’ reflecting a cautious stance on Clorox’s near-term prospects. While the mean target suggests significant upside, a lack of ‘Buy’ ratings indicates analysts are waiting for clearer catalysts or a more definitive bottom.
π Bull vs Bear β Probability-Weighted Scenarios
π Bull Case
- Strong brand loyalty and successful pricing actions allow Clorox to expand margins, exceeding current market expectations.
- Economic uncertainty drives capital into defensive stocks, pushing CLX’s valuation multiple higher towards historical averages.
π Base Case
Clorox navigates inflationary pressures and competitive dynamics, maintaining stable, albeit modest, revenue growth and earnings. The attractive dividend yield continues to support the stock, preventing further significant downside while growth remains constrained. This scenario implies a fair value around the analyst consensus.
π» Bear Case
- Aggressive competition and sustained inflation lead to significant margin compression, forcing earnings estimates lower.
- A broader market downturn or a specific company misstep triggers a re-rating of defensive stocks, pushing CLX towards its 52-week low and beyond.
π― Investor Action Plan β By Profile
The strong bearish trend and lack of clear support make CLX a high-risk proposition for short-term trades. Stay on the sidelines until a definitive bullish reversal pattern emerges, ideally with confirmation above $105.00.
While the stock is oversold, the technical confluence score of 50/100 indicates mixed signals. Consider scaling into a position only if CLX tests and holds the $98.00 level or the 52-week low of $96.66, confirming a potential bottom.
For long-term conviction, wait for fundamental improvements or a clearer technical confirmation of a bottom. The current dividend yield is attractive, but a deeper dive into future earnings guidance is crucial before committing significant capital.
β Investor FAQ β People Also Ask
Q: Is Clorox’s current dividend yield sustainable given its recent stock performance?
Clorox boasts a 4.90% dividend yield, supported by $0.3B in Free Cash Flow in the latest quarter. While the stock has fallen, the company’s cash generation and commitment to buybacks suggest the dividend remains sustainable in the near term, offering a buffer for investors.
Q: What does the ‘oversold’ RSI at 26.3 imply for CLX’s immediate future?
An RSI of 26.3 indicates Clorox is deeply oversold, a condition that often precedes a short-term bounce or relief rally. However, with a strong bearish trend confirmed by the ADX, this oversold condition alone does not guarantee a sustained reversal; it merely signals exhaustion in selling pressure.
Q: Why is the consensus rating a ‘Hold’ despite significant upside to the mean target?
Analysts typically assign ‘Hold’ ratings when they see a balanced risk-reward profile or lack clear catalysts for a strong move in either direction. Despite the 20.68% upside to the mean target, the prevailing macro headwinds and technical downtrend likely keep analysts cautious, awaiting more definitive signals.
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π Disclaimer
This analysis is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results. All data is accurate as of the date of publication.
All active positions and their real-time performance are tracked on our Investment Log.
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