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    Is Clorox (CLX) Undervalued After Its Earnings Miss Hit Profits?

    Simply Wall St·08/03/2026 23:35:29
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    Clorox earnings miss highlights pressure on profits

    Clorox (CLX) just reported fourth quarter results that showed both sales and profitability under pressure. Revenue came in at US$1,948 million, while net income was US$163 million and diluted EPS was US$1.34.

    These figures compared to US$1,988 million in sales, US$332 million in net income and diluted EPS of US$2.68 in the same quarter a year earlier. The scale of the earnings decline is likely a key focus for investors.

    See our latest analysis for Clorox.

    Clorox shares closed at US$95.53 and the stock has fallen over the year based on an 18.90% decline in the 1 year total shareholder return, even though the 90 day share price return of 9.67% points to some recent positive momentum. The latest earnings miss, alongside last week's small quarterly dividend increase, has likely sharpened the market's focus on how the company balances profit pressure with shareholder payouts.

    If this earnings reaction has you reassessing consumer staples, you might want to broaden your watchlist and check out 18 top founder-led companies

    The recent rebound in Clorox after a tougher quarter sets up a simple question: Has most of the recovery already played out in the share price, or does the current valuation still leave meaningful upside on the table?

    Most Popular Narrative: 9.3% Undervalued

    Clorox is trading at $95.53 against a most followed narrative fair value of $105.29, which frames the current pullback as only part of the story.

    The full-scale implementation of a modern ERP system is expected to drive long-term operational efficiencies, improving supply chain visibility, speeding innovation cycles, and reducing structural costs, which should support margin expansion and sustained earnings growth once short-term transition noise normalizes.

    Read the complete narrative.

    Want to see what kind of revenue path and margin profile that ERP shift is built on? The narrative leans on steady top line progress and disciplined profitability assumptions that sit behind that fair value. The detailed earnings bridge and pricing expectations are where the story really gets interesting.

    Result: Fair Value of $105.29 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, you also need to factor in softer category trends and heavier discounting in areas like Glad and cat litter, which could put pressure on Clorox margins.

    Find out about the key risks to this Clorox narrative.

    Next Steps

    With Clorox facing both pressure on earnings and some constructive long term narratives, it makes sense to look at the full risk and reward picture yourself while this information is fresh. To see how the positives and concerns stack up side by side, review the 4 key rewards and 2 important warning signs

    Looking for more Clorox style investment ideas?

    Do not stop with Clorox. Use the Simply Wall Street Screener to widen your watchlist and spot opportunities you might regret missing later.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.