Why Is Clorox (CLX) Up 5.4% Since Last Earnings Report?

Core Viewpoint - Clorox's recent earnings report shows significant recovery and growth, driven by improved sales and cost management, despite previous challenges from a cyberattack and divestitures [2][3][4]. Financial Performance - Clorox reported adjusted EPS of $1.86, a substantial increase from $0.49 in the same quarter last year, exceeding the Zacks Consensus Estimate of $1.36 [3]. - Net sales reached $1.76 billion, a 27% increase year-over-year, surpassing the Zacks Consensus Estimate of $1.63 billion [4]. - Organic sales grew by 31% year-over-year, with double-digit growth across all segments [4]. Segment Analysis - The Health and Wellness segment saw sales rise 38% year-over-year to $698 million, driven by volume growth and a favorable mix [6]. - The Household segment's sales improved 38% year-over-year to $447 million, primarily due to volume growth [7]. - The Lifestyle segment reported a 40% increase in sales to $320 million, benefiting from improved volume [8]. - The International segment experienced a 4% decline in sales to $259 million, attributed to the divestiture of the Argentina business and adverse currency rates [9]. Margin and Cost Management - Gross margin expanded by 740 basis points year-over-year to 45.8%, marking the eighth consecutive quarter of margin expansion [5]. - The company implemented a comprehensive margin management program, contributing to its capacity for growth [5]. Guidance and Future Outlook - Clorox expects fiscal 2025 net sales to be flat to down 2%, with organic sales anticipated to increase by 3-5% [11]. - The gross margin is projected to improve by 100-150 basis points, despite cost inflation and higher promotional expenses [12]. - Adjusted EPS guidance for fiscal 2025 has been revised to $6.65-$6.90, indicating an 8-12% year-over-year increase [13]. Market Position and Sentiment - Clorox's stock has gained approximately 5.4% since the last earnings report, outperforming the S&P 500 [1]. - The consensus estimate for Clorox has trended downward by 9.75% recently, reflecting a shift in market sentiment [14][15]. - Clorox holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [17].