Consumer products giant Clorox (NYSE:CLX) reported Q3 CY2024 results topping the market’s revenue expectations , with sales up 27.1% year on year to $1.76 billion. Its non-GAAP profit of $1.86 per share was also 33.6% above analysts’ consensus estimates.

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Clorox (CLX) Q3 CY2024 Highlights:

• Revenue: $1.76 billion vs analyst estimates of $1.64 billion (7.6% beat)

• Adjusted EPS: $1.86 vs analyst estimates of $1.39 (33.6% beat)

• Management raised its full-year Adjusted EPS guidance to $6.78 at the midpoint, a 1.5% increase

• Gross Margin (GAAP): 45.8%, up from 39.2% in the same quarter last year

• Operating Margin: 10%, up from 5.3% in the same quarter last year

• Organic Revenue rose 31% year on year (-18% in the same quarter last year)

• Market Capitalization: $19.43 billion

"We achieved better-than-expected results this quarter and fully restored overall market share, enabling us to maintain our sales outlook and raise our gross margin and EPS outlook for the year," said Chair and CEO Linda Rendle.

Company Overview

Founded in 1913 with bleach as the sole product offering, Clorox (NYSE:CLX) today is a consumer products giant whose product portfolio spans everything from bleach to skincare to salad dressing to kitty litter.

Household Products

Household products stocks are generally stable investments, as many of the industry's products are essential for a comfortable and functional living space. Recently, there's been a growing emphasis on eco-friendly and sustainable offerings, reflecting the evolving consumer preferences for environmentally conscious options. These trends can be double-edged swords that benefit companies who innovate quickly to take advantage of them and hurt companies that don't invest enough to meet consumers where they want to be with regards to trends.

Sales Growth

Reviewing a company’s long-term performance can reveal insights into its business quality. Any business can have short-term success, but a top-tier one sustains growth for years.

Clorox is one of the larger consumer staples companies and benefits from a well-known brand that influences consumer purchasing decisions. However, its scale is a double-edged sword because it's harder to find incremental growth when you've already penetrated the market.

As you can see below, Clorox’s 1.1% annualized revenue growth over the last three years was weak. This shows it failed to generate demand in any major way and is a rough starting point for our analysis.

This quarter, Clorox reported robust year-on-year revenue growth of 27.1%, and its $1.76 billion of revenue topped Wall Street estimates by 7.6%.