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Here's Why Clorox (CLX) Looks Well-Placed for Q3 Earnings Beat

The Clorox Company CLX is likely to register top-line growth when it reports third-quarter fiscal 2023 earnings on May 2. The company is likely to register a top-line decline when it reports the quarterly results.

The Zacks Consensus Estimate for quarterly revenues is pegged at $1.8 billion, suggesting growth of 0.9% from the prior-year quarter’s reported figure. The Zacks Consensus Estimate for quarterly earnings has moved down by a penny in the past seven days to $1.23 per share. The consensus mark indicates a decline of 6.1% from the figure reported in the prior-year quarter.

We expect the company’s fiscal third-quarter net sales to decline 0.3% year over year to $1,804.5 million and the bottom line to dip 8.6% to $1.2 per share.

The consumer and professional products company has a trailing four-quarter earnings surprise of 27.8%, on average. CLX delivered an earnings surprise of 50.8% in the last reported quarter.

The Clorox Company Price and EPS Surprise

 

The Clorox Company price-eps-surprise | The Clorox Company Quote

Factors to Note

Clorox has been gaining from solid demand for its products and brands, cost-saving efforts, and strong execution and pricing actions. Its IGNITE strategy and digital investments also bode well. This is likely to have aided the top and bottom lines in third-quarter fiscal 2023.

The company has been witnessing continued strength in the core International business as it has been building on the success of the segment's Go Lean strategy. Driven by its IGNITE strategy, which aims to improve profitability in the International business, the company has been investing selectively in profitable platforms. These efforts are expected to have accelerated profitable growth for the segment in the to-be-reported quarter.

Management has been exploring international opportunities, including the acquisition of a majority stake in its joint venture in the Kingdom of Saudi Arabia. This is expected to have boosted the company’s organic sales performance in the to-be-reported quarter.

However, Clorox has been witnessing adverse impacts of inflation, and higher manufacturing, logistics and commodity costs. Such downsides should have hurt the company’s bottom-line performance in the to-be-reported quarter.

What the Zacks Model Unveils

Our proven model conclusively predicts an 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 chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Clorox has a Zacks Rank #3 and an Earnings ESP of +0.14%.

Other Stocks Poised to Beat Earnings Estimates

TreeHouse Foods THS has an Earnings ESP of +19.75% and a Zacks Rank of 3 at present. The company is slated to report first-quarter 2023 results on May 8. The Zacks Consensus Estimate for its quarterly revenues is pegged at $849.03 million, which suggests a decline of 25.6% from the figure reported in the prior-year quarter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for TreeHouse’s quarterly earnings has moved up 5.4% in the past 30 days to 39 cents per share, suggesting growth of 360% from the year-ago quarter’s reported number. THS’ earnings beat the consensus estimate in the trailing four quarters, delivering an earnings surprise of 48.8%, on average.

Colgate-Palmolive CL has an Earnings ESP of +1.20% and a Zacks Rank of 2 at present. The company is expected to report first-quarter 2023 results on Apr 28. The Zacks Consensus Estimate for its quarterly revenues is pegged at $4.6 billion, which suggests growth of 4.2% from the figure reported in the prior-year quarter.

The consensus estimate for Colgate’s quarterly earnings has been unchanged in the past 30 days to 70 cents per share, suggesting a decline of 5.4% from the year-ago quarter’s reported number. CL’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, delivering an earnings surprise of 0.4%, on average.

e.l.f. Beauty, Inc. ELF has an Earnings ESP of +3.77% and a Zacks Rank of 2 at present. The company is slated to report fourth-quarter fiscal 2023 results on May 24. The Zacks Consensus Estimate for its quarterly revenues is pegged at $155.1 million, which suggests growth of 47.5% from the figure reported in the prior-year quarter.

The Zacks Consensus Estimate for e.l.f. Beauty’s quarterly earnings has been unchanged in the past 30 days at 19 cents per share, suggesting growth of 46.2% from the year-ago quarter’s reported number. ELS’ earnings beat the Zacks Consensus Estimate in the trailing four quarters, delivering an earnings surprise of 105%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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