The Clorox Company CLX is likely to register a decline in top and bottom lines when it reports second-quarter fiscal 2025 results on Feb. 3, after market close.
The Zacks Consensus Estimate for revenues is pegged at $1.64 billion, suggesting a decrease of 17.8% from the prior-year quarter. The consensus mark for quarterly earnings has risen 1.4% in the past seven days to $1.40 per share, indicating a decline of 35.2% from the figure reported in the year-ago quarter. CLX delivered an earnings surprise of 45.9% in the last reported quarter.
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Things to Consider About CLX’s Upcoming Results
Clorox continues to operate in a challenging macroeconomic environment where consumers face ongoing financial pressures. The company has been contending with increased advertising expenses essential for maintaining brand visibility and has weighed on its profitability. Clorox faces stiff competition in the consumer goods sector, which further pressures its market share and operational performance.
The consumer and professional products company looks well poised for the upcoming release, thanks to its robust growth strategies. Clorox has been benefiting from its IGNITE strategy, which mainly focuses on the expansion of the key elements under the 2020 Strategy to pace up innovation across each area of business.
Clorox is experiencing strong progress in the core International business as it continues to build on the success of the segment's Go Lean strategy. These efforts will help in accelerating profitable growth for the segment. Driven by its IGNITE Strategy, which aims to improve profitability in International business, the company expects to invest selectively in profitable platforms. Management continues to explore international opportunities in the upcoming quarter.
Clorox has been actively streamlining its operating model to enhance efficiency and drive productivity, a strategy that might have contributed positively to its recent performance. The streamlined approach has improved the company's agility in adapting to changing consumer behaviors, accelerating innovation and generating increased cash flow. This has been achieved through cost savings across key areas. The aforesaid aspects are expected to have aided its quarterly performance.
Our model predicts operating profit to increase 50.4% year over year and the operating margin to expand 640 basis points (bps) to 14.2%.
The Clorox Company Price, Consensus and EPS Surprise
The Clorox Company price-consensus-eps-surprise-chart | The Clorox Company Quote
What the Zacks Model Unveils for CLX
Our proven model predicts a likely earnings beat for Clorox this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Clorox currently has an Earnings ESP of +0.06% and a Zacks Rank of 3.
CLX’s Price Performance & Valuation
From a valuation perspective, CLX stock trades at a premium relative to the industry. CLX has a forward 12-month price-to-earnings ratio of 22.98x, above the Consumer Products - Staples industry’s average of 21.43x.
CLX has shown impressive momentum, with its stock rallying 21.4% over the past six months, outperforming its industry’s decline of 1.8% during the same period. Furthermore, Clorox’s performance has surpassed the broader Consumer Staples sector’s 4.6% decline and the S&P 500's 10.8% increase, showcasing the company's strong market positioning and resilience in a competitive environment.
CLX Stock's Past Six Months Performance
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Other Stocks With the Favorable Combination
Here are other companies that, according to our model, have the right combination of elements to beat on earnings this reporting cycle.
Church & Dwight CHD currently has an Earnings ESP of +0.11% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter 2024 EPS is pegged at 77 cents, which implies a roughly 18.5% increase year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Church & Dwight’s quarterly revenues is pegged at $1.56 billion, which indicates growth of 2.4% from the figure reported in the prior-year quarter. CHD has a trailing four-quarter earnings surprise of roughly 10%, on average.
Tyson Foods, Inc. TSN currently has an Earnings ESP of +3.36% and a Zacks Rank of 2. The Zacks Consensus Estimate for first-quarter fiscal 2025 EPS is pegged at 79 cents, which implies a 14.5% increase year over year.
The Zacks Consensus Estimate for Tyson Foods’ quarterly revenues is pegged at $13.5 billion, which indicates growth of 1.2% from the figure reported in the prior-year quarter. TSN has a trailing negative four-quarter earnings surprise of roughly 57%, on average.
Sysco Corporation SYY currently has an Earnings ESP of +0.38% and a Zacks Rank of 3. The Zacks Consensus Estimate for second-quarter fiscal 2025 EPS is pegged at 93 cents, which implies a roughly 4.5% increase year over year.
The Zacks Consensus Estimate for Sysco’s quarterly revenues is pegged at $20.1 billion, which indicates growth of 4.2% from the figure reported in the prior-year quarter. SYY has a trailing negative four-quarter earnings surprise of roughly 0.2%, on average.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>The Clorox Company (CLX) : Free Stock Analysis Report
Church & Dwight Co., Inc. (CHD) : Free Stock Analysis Report
Tyson Foods, Inc. (TSN) : Free Stock Analysis Report
Sysco Corporation (SYY) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
