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Clorox 4Q Tops Estimates; Names New CEO
Consumer-products maker, Clorox, reported solid 4Q earnings on Monday driven by pandemic-led demand for cleaning and disinfecting products.
Clorox's (CLX) earnings of $2.41 per share jumped 28% year-over-year and came ahead of the consensus estimate of $1.99. Strong sales and cost savings cushioned its bottom line.
Its sales surged 22% to $1.98 billion year-over-year and exceeded Wall Street expectations of $1.87 billion. Organic sales grew 24% year-over-year, thanks to the double-digit volume growth across all segments.
Separately, Clorox named Linda Rendle as its new CEO. Rendle, who is currently serving as president, will take up the role from September 14. The current CEO Benno Dorer will continue to serve as executive chairman.
On July 16, JPMorgan analyst Andrea Faria Teixeira said he expected strong earnings season due to "stay home tailwinds." She also told investors in a note that “consumers seem to be diverting their wallet from travel and entertainment to at-home consumption.” Teixeira raised the price target on Clorox to $235 (1.3% upside potential) from $203 and kept a Buy rating on the stock.
Currently, the Street has a cautious outlook on the stock. The Hold analyst consensus is based on 4 Holds, 2 Buys and 3 Sells. In view of the 51% stock rally year-to-date, the average price target of $202.89 implies downside potential of about 13%. (See CLX stock analysis on TipRanks).
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