OAKLAND, Calif. - The Clorox Company (NYSE: NYSE:CLX) has completed the sale of its Better Health Vitamins, Minerals, and Supplements (VMS) business to Piping Rock Health Products, LLC affiliate, the company announced today. The transaction includes the divestiture of the Natural Vitality, NeoCell, Rainbow Light, and RenewLife brands, along with their trademarks, licenses, and the manufacturing and distribution operations located in Sunrise, Florida.
This strategic move is part of Clorox's broader effort to reshape its brand portfolio with the aim of reducing business volatility and driving sustainable sales growth and improved margins. The company has expressed its intent to focus on achieving more consistent and profitable growth moving forward.
The Clorox Company, known for its wide array of consumer and professional products, including Brita, Burt's Bees, and its eponymous bleach, has been a mainstay in American homes for over a century. With a strong commitment to environmental, social, and governance (ESG) principles integrated into its business model, Clorox has recently been recognized for its sustainability efforts, earning the top spot on Barron's 100 Most Sustainable Companies list for the second year in a row in 2024.
Details of the financial terms of the divestiture have not been disclosed. The information reported is based on a press release statement from The Clorox Company.
In other recent news, Clorox has seen several significant developments. Clorox reported its seventh consecutive quarter of margin expansion, despite the challenges posed by a past cyberattack. Financial firms Exane BNP Paribas (OTC:BNPQY), Jefferies, and Citi have all adjusted their price targets for Clorox. Exane BNP Paribas raised its target to $140, maintaining an underperform rating due to concerns over slowed growth and potential for consumers to choose cheaper alternatives. Jefferies increased its target to $174, citing Clorox's clear path to delivering on its sales growth guidance and margin expansion. Citi raised its target to $170, noting Clorox's ability to regain shelf space and market share after the cyberattack.
CloroxPro, a branch of the company, has expanded its EcoClean line with the introduction of plant-based Disinfecting Wipes. These eco-friendly wipes combat 99.9% of germs, including common cold, flu viruses, norovirus, and COVID-19. In terms of future expectations, Clorox aims for 20-25% sales growth in the first quarter of the fiscal year and plans to return to pre-pandemic gross margins. These recent developments underscore Clorox's commitment to growth and recovery.
InvestingPro Insights
Following the sale of its Vitamins, Minerals, and Supplements business, The Clorox Company (NYSE: CLX) is poised to refine its brand portfolio and focus on its core products. With an eye on sustainable growth, Clorox is leveraging its strong market position and long-standing brand reputation to drive forward. InvestingPro data and insights provide a deeper understanding of the company's financial health and stock performance.
An InvestingPro Tip highlights that Clorox has successfully raised its dividend for 47 consecutive years, demonstrating a consistent commitment to returning value to shareholders. Additionally, analysts have revised their earnings estimates upwards for the upcoming period, signaling confidence in the company's financial outlook. Clorox's net income is also expected to grow this year, which could further solidify its position in the market.
InvestingPro Data points to consider include:
- The stock's Relative Strength Index (RSI) suggests it is currently in overbought territory, which could influence investor decisions on timing their trades.
- Clorox is trading at a low Price/Earnings (P/E) ratio relative to near-term earnings growth, indicating potential undervaluation compared to its growth prospects.
- The company has maintained dividend payments for 54 consecutive years, underscoring its financial stability and reliability as an income stock.
For investors interested in a comprehensive analysis, there are additional InvestingPro Tips available for The Clorox Company (NYSE: CLX) at InvestingPro, offering valuable insights into the company's valuation multiples, profitability, and analyst predictions for profitability this year.
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