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Live Off Dividends
Writer's pictureAdam Kenyeres

Investing in Clorox(CLX) – Rise and Shine ✨

The Clorox Company manufactures and markets consumer and professional products worldwide. It operates through four segments: Health and Wellness, Household, Lifestyle, and International.


Market Cap: $17b S&P rating: BBB+


What happened with Clorox? Why are we seeing on the chart a big decline since July 2020? 💣


„Shares of Clorox were falling sharply Friday after the maker of disinfectant wipes and other cleaning products reported fiscal second-quarter adjusted earnings that missed analysts’ expectations and said margins would take a steep hit from continued cost pressures.”

This was the latest news about Clorox and about the price fall in February. After I did some research it became very clear that this problem has appeared first in the third quarter of 2020. That’s why the price is declining.


The current situation and the past performance…📊


So the first thing we want to look at is the current P/E ratio, which is 32. It is surprisingly high. First, I like the P/E under 25, secondly, the price like I just wrote is beaten down so it is a surprise to me that the P/E after all this is that high.

The gross profit is up year after year, it is growing slowly but steady. EBITDA is growing as well.

If we look at the chart from a classic view standpoint then the last 20 years brought us an 8.6% Total Annual Return which is very good in my opinion + the dividends. The stock price is above the Margin of Safety(orange line) since 2010 but right now they are getting closer again. A small growth rate for a company like this is acceptable.


From a dividend standpoint…💵