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Fundamental analysis: The Clorox Company (CLX)

Awarener score: 6.0

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 3.5

• Business has been shrinking at a fast pace. It's been last-in-rank when measured against peer companies.
• The Clorox Company business trend isn't so stable. The higher the stability, the lower the risk. It looks mediocre against rivals.

Margins score: 7.7

• CLX profit margins -on goods and services sold- are usually sufficient. They stand worse than most rival companies.
• Business profit on sales tends to be excellent. It's more than average in relation to competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually good. They remain a slight improvement compared to peers.
• Earnings -before income taxes and interests on loans taken- tend to be very good in relation to total revenues. They're still somewhat better than similar companies.
• Profits -before income taxes- are usually very good considering total sales, and remain encouraging in relation to rivals.
• Total net profit tends to be very good when confronted to sales. Company stands more than average in relation to comparable firms.

Growth score: 3.6

• The Clorox Company profit -on goods and services sold- has been shrinking. It's been in a very weak position compared to competitors.
• In recent years, earnings growth -on operations- have been almost stagnant, which has been mediocre against comparable firms.
• Profits -available to repay debt and purchase properties- tended to shrink, which compares substantially worse when measured against peer enterprises.
• Growth on earnings -before income taxes and interests on loans taken- have been almost stagnant. It turns to be in a weak position compared to similar stocks.
• In past years, profits -before income taxes- grew at a low speed. It was somewhat worse than rivals.
• In the previous years, growth on total net profit has been low, and below average when measured against peer companies.
• Earnings per share have grown at a low rhythm in past years. It's been lacking compared to industry peers.

Miscellaneous score: 5.0

• CLX had to pay some income taxes in relation to profits made in the past years. It's been slightly worse than peers.
• Research and development expenses consume a very little portion of revenues. It's below average when measured against competitors.
• Business has seen substantial shrinking, despite research and development efforts. It stands a disappointment compared to rival companies.

Profitability score: 10.0

• The Clorox Company usually gets huge returns on the resources it controls. It proves great when measured against peer firms.
• The company normally gets huge proceeds -on the resources directly invested in the business-. They remain in good shape compared to similar companies.
• Profitability -in relation to owned resources- is usually paramount. It ranks great when measured against competitors.
• In the past, got huge returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's more than average in relation to comparable enterprises.

Usage of Funds score: 6.4

• CLX usually uses a portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is rather normal. It stands more than average in relation to rival firms.
• The company is usually somewhat investing in new property, plant, and equipment, to improve its operating capabilities, which is more than average in relation to industry peers.
• In the past twelve months it paid good dividends, considering the current stock price. It came slightly better than competitors.
• Dividend payments have been more or less stable in recent years. The company has behaved close to average when compared to similar firms.
• The company usually uses a large portion of genuine funds generated to pay dividends. There could be some concerns on sustainability if business takes a dive. Sustainability looks somewhat worse than comparable companies.
• The company usually reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains in good shape compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands in good shape compared to rivals.
• We do not have sufficient data to comment on buybacks and their sustainability. It still looks dubious against competitors.

Balance Sheet score: 4.4

• The Clorox Company intangible assets (like brands and goodwill) represent a huge portion of resources controlled, according to accounting books. There could be major difficulties in liquidating them if the company ever gets in financial distress. It happens to be last-in-rank when measured against peer companies.
• The company has somewhat lower short-term resources than short-term obligations. Unless it's part of the business model, there might some liquidity concerns. It turns to be in a very weak position compared to similar firms.
• A substantial part of resources controlled were provided for with financial debt. Creditors have as many claims on the company as shareholders. The situation is somewhat risky. It remains worse than most rival firms.
• Most controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks below average when measured against rivals.
• For every dollar of short-term obligations, the company has less than a dollar of cash and short-term receivables. It's in a very weak position compared to peer firms.
• For every dollar of short-term obligations, the company has very few cents of cash and equivalents, which is bottom tier against similar enterprises.
• Usually, sales are on a month and a half credit. It still ranks almost average when measured against peers.
• Normally has approximately somewhat more than two months of sales worth in inventory. It comes up as a slight improvement compared to competitors.
• On average, it takes higher than four months from the purchase to charging customers. It happens to be somewhat better than peers.
• Pays suppliers mostly in cash. It ranks last-in-rank when measured against industry peers.
• The company pays its suppliers four months or more before charging its customers, so there's significant money invested in working capital. It's close to average when compared to similar companies.
• Net interest expenses consume a minor portion of usual business earnings, and are easily bearable. It stands slightly worse than rival firms.
• Business earnings have usually been good when measured against loans taken. Cutting back reinvesting in the business, it could take less than three years to repay the obligations with current profitability. It ranks below average when measured against comparable enterprises.
• Revenues are modest in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks a disappointment compared to similar firms.
• Resource exploitation is very good when yearly sales are considered. This metric is normally tied to the industry where the firm belongs. It's still slightly better than peer companies.

Valuation score: 4.5

• The Clorox Company looks heavily expensive in relation to profits and financial position. It happens to be almost average when measured against competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains a disappointment compared to peers.
• In the past twelve months, the company generated some free funds in relation to the stock price, which stands slightly better than similar companies.
• The company usually generates reasonably more than enough genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, the current valuation might be fair. It's still similar to industry firms.
• In the past twelve months, the company has slightly rewarded investors, considering both dividends and share on the pie of earnings. It came up rather normal in relation to peer ventures.
• The company has barely more debt than cash. It may borrow extra money if it wishes so, or start cumulating cash for future uses. It looks somewhat worse than similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation is very high. A lot of improvement expectations are already in the stock price, which is risky. It ranks almost average when measured against peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a very high relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks lacking compared to rival firms.
• The relation between the stock price and accounting book value is extremely high, which may be good or bad depending on context. Run again in analytic mode if you want to dig deeper. The company remains mediocre against peer firms.
• In the past twelve months, the operating business lost a little money. It happens to be below average when measured against industry peers.
• In an alternate metric of bang for the buck, the company has usually shown a good earnings power ability when measured against the current stock price and financial position. It's still a slight improvement compared to peer companies.

Total score: 5.6

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Awarener score: 6.0

Conclusion

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