Dividend Aristocrats In Focus: The Clorox Company

Up to date on January thirtieth, 2026 by Bob Ciura

Client staples shares are a number of the most dependable dividend payers within the inventory market. Folks want staples merchandise for his or her each day lives, which supplies a sure stage of demand from 12 months to 12 months.

Demand for on a regular basis merchandise stays regular, even throughout recessions, which makes it an interesting business for traders on the lookout for constant dividends.

For this reason there are a number of shopper staples shares on the Dividend Aristocrats record, which incorporates 69 firms within the S&P 500 Index, with 25+ consecutive years of dividend will increase.

You may obtain an Excel spreadsheet of all 69 Dividend Aristocrats (with metrics that matter comparable to dividend yields and price-to-earnings ratios) by clicking the hyperlink beneath:

Disclaimer: Certain Dividend shouldn’t be affiliated with S&P World in any manner. S&P World owns and maintains The Dividend Aristocrats Index. The knowledge on this article and downloadable spreadsheet relies on Certain Dividend’s personal overview, abstract, and evaluation of the S&P 500 Dividend Aristocrats ETF (NOBL) and different sources, and is supposed to assist particular person traders higher perceive this ETF and the index upon which it’s based mostly. Not one of the info on this article or spreadsheet is official knowledge from S&P World. Seek the advice of S&P World for official info.

Annually, we overview all Dividend Aristocrats individually. The subsequent inventory within the collection is The Clorox Firm (CLX). Clorox has raised its dividend for 48 years in a row.

This text will present an in-depth overview of Clorox’s enterprise mannequin and future outlook.

Enterprise Overview

Clorox began over 100 years in the past, with its namesake liquid bleach debuting in 1913. At this time, it’s a world producer of shopper {and professional} merchandise that collectively span all kinds of makes use of and clients.

The corporate produces annual income in extra of $7 billion and sells its merchandise in over 100 markets.

The corporate has a extremely various set of companies with myriad manufacturers and merchandise inside every, offering Clorox with big world scale.

The corporate’s largest phase is well being and wellness, which is a part of the core Cleansing phase. Nevertheless, Clorox is rather more than a cleaner firm because it produces meals, pet merchandise, charcoal, and varied different manufacturers.

The Family phase contains the Glad, Kingsford, Contemporary Step, and Renew Life manufacturers. Cleansing merchandise embrace Clorox, Pine-Sol, and the Clorox Industrial Options companies.

Way of life manufacturers embrace Hidden Valley, Burt’s Bees, and Brita. Lastly, the Worldwide phase sells Clorox’s manufacturers world wide.

Clorox posted first quarter earnings on November third, 2025, and outcomes had been higher than anticipated on each the highest and backside strains.

Adjusted earnings-per-share got here to 85 cents, which was seven cents forward of estimates. Income was down nearly 19% year-over-year to $1.43 billion, however did at the very least beat estimates by $30 million.

Gross sales had been down primarily attributable to decrease shipments associated to the corporate’s ERP transition. Natural gross sales plunged 17% throughout the quarter.

The corporate shipped about two weeks of stock within the prior quarter to account for this, so it ought to normalize within the subsequent quarter.

Gross margin got here to 41.7% of income, down 410 foundation factors. This was attributable to increased manufacturing and logistics prices, primarily. Web money from operations fell 58% to only $93 million.

The corporate reiterated steering for this 12 months regardless of the weak quarter. We’ve reduce our estimate to $6.00 in adjusted earnings-per-share on yet one more weak quarter in a string of such outcomes.

Progress Prospects

Wanting forward, Clorox has some levers it could pull to proceed its development. The corporate constantly innovates with product extensions on its present lineup, comparable to flavors and cross-branding.

It has completed these issues for a very long time and can proceed to take action to be able to keep aggressive.

It is usually focusing its mergers and acquisitions on rising firms, centered within the US, and margin-accretive. The corporate needs to spice up home development and margins via acquisitions.

Margin growth is one other longer-term aim for the corporate.

Clorox sees potential in rebuilding its margins via pricing actions, value financial savings, and optimizing its provide chain over the long run.

Clorox can also be taking a prudent strategy by shopping for firms with a greater margin profile than its present portfolio, which boosts income and margins concurrently.

We see Clorox producing 5% earnings-per-share development yearly within the coming years as situations normalize beneath the belief that 2026 is more likely to be a trough for earnings.

Clorox continues to purchase small quantities of development whereas specializing in value financial savings and lowering the float.

Margins completed final 12 months very strongly, with pricing will increase and value financial savings combining to spice up profitability. We word continued energy in natural gross sales as a key driver of earnings.

Aggressive Benefits & Recession Efficiency

Clorox has a number of aggressive benefits. First, it holds a tremendously sturdy model portfolio. As beforehand talked about, Clorox merchandise get pleasure from excessive market share throughout the portfolio.

Clorox retains its excessive business place via promoting and spends very closely to take care of that place.

Product advertising and marketing is a necessity for shopper merchandise producers and Clorox spends ~10% of its income on this every year.

One other benefit of Clorox’s enterprise mannequin is that its merchandise are utilized by thousands and thousands of individuals every day, each in good and dangerous economies.

There’ll at all times be a sure demand for family cleansing merchandise and meals, even when the financial system is downturned. This enables the corporate to stay worthwhile throughout recessions.

Certainly, Clorox is a robust instance of a defensive inventory. Its earnings-per-share via the Nice Recession are proven beneath:

• 2007 earnings-per-share of $3.23
• 2008 earnings-per-share of $3.24 (0.3% enhance)
• 2009 earnings-per-share of $3.81 (18% enhance)
• 2010 earnings-per-share of $4.24 (11% enhance)

As you possibly can see, Clorox elevated earnings-per-share every year all through the recession, together with double-digit earnings development in 2009 and 2010.

Clorox additionally carried out very effectively throughout the coronavirus pandemic, as its merchandise noticed a lot increased demand as shoppers spent rather more time at dwelling.

This demonstrates the corporate has a really recession-resistant enterprise mannequin and a excessive stage of security.

Valuation & Anticipated Returns

We anticipate Clorox to generate earnings-per-share of $6.00 for fiscal 2025. Primarily based on this, CLX shares commerce for a price-to-earnings ratio of 18.2x. That is above our estimate of truthful worth, which is 20 occasions earnings.

Subsequently, the inventory appears undervalued. An increasing P/E a number of might broaden annual returns by 1.9%.

Shareholder returns might be additional boosted by future earnings-per-share development, which we estimate at 5% per 12 months.

Lastly, Clorox’s 4.5% dividend yield will add to shareholder returns. This results in complete anticipated returns of 10.5% per 12 months over the following 5 years.

This can be a first rate anticipated fee of return and warrants a maintain score at the moment.

Closing Ideas

Clorox is a dependable dividend inventory. The corporate has a management place throughout its product markets, with potential for some development.

The corporate ought to be capable of proceed its four-decade-long streak of annual dividend raises whatever the total financial local weather. This makes it a constant dividend inventory for risk-averse revenue traders.

Thus, the inventory is a maintain, and traders desirous about complete return potential might decide up some shares at immediately’s value.

Moreover, the next Certain Dividend databases include probably the most dependable dividend growers in our funding universe:

• The Dividend Champions: Dividend shares with 25+ years of dividend will increase, together with these that won’t qualify as Dividend Aristocrats.
• The Dividend Kings: thought of to be the final word dividend development shares, the Dividend Kings record is comprised of shares with 50+ years of consecutive dividend will increase

When you’re on the lookout for shares with distinctive dividend traits, contemplate the next Certain Dividend databases:

The main home inventory market indices are one other stable useful resource for locating funding concepts. Certain Dividend compiles the next inventory market databases and updates them month-to-month: