Ratings and target price
Analysts covering Clorox (CLX) have rated the stock a 2.9 on a scale of one (strong buy) to five (strong sell) and maintain a neutral outlook. The company through its formidable portfolio of brands has managed to generate industry-leading volumes. Moreover, the company’s focus on innovation is further helping its sales. Also, Clorox is generating incremental sales from its acquisition of RenewLife. The company is generating higher sales and volumes in the US (SPY) amid weakness in demand for consumer products.
Despite its strong sales, the company’s margins remain challenged due to rising manufacturing and commodity costs. Besides, increased trade promotions to support new products further remain a drag. Going forward, management expects to benefit from its productivity savings measures. However, gross margins are likely to remain low due to the reasons mentioned above. Moreover, industry-wide weakness is liable to impact the company’s growth negatively and keep analysts on the sideline.
Of the 18 analysts providing ratings on Clorox stock, 11.0% maintained a “buy,” 78.0% recommended a “hold,” and 11.0% rated it a “sell.” As of July 24, 2017, Clorox stock was trading ~1.2% below the analysts’ 12-month target price of $132.93.
What analysts recommend for peers
Analysts maintain a “neutral” outlook on consumer product companies given the slowdown in demand. 59.0% of analysts covering Church & Dwight (CHD) stock maintain a “hold,” 14.0% recommend a “buy,” and 27.0% provided a “sell” rating. As for Colgate-Palmolive (CL), of the 22 analysts, 14.0% recommended a “buy,” and 86.0% maintained a “hold.” Meanwhile, 7.0% of the 15 analysts maintained a “buy” on Kimberly-Clark (KMB) stock, 86.0% have provided a “hold” rating, and 7.0% recommended a “sell.”