Stock Analysis | The Clorox Outlook - Weak Technicals, Mixed Analyst Views, and Strong Fundamentals

Market Snapshot

Takeaway: Clorox's technical outlook is weak, but fundamentals remain robust. With a bearish technical score of 1.44 and three negative indicators dominating, the price has recently fallen by 2.79%, signaling caution for short-term investors.

News Highlights

Recent news impacting broader market sentiment includes:

• U.S. Visa Policy Shifts (May 28): New restrictions on Chinese students could impact international trade and cross-border corporate ties, possibly affecting consumer goods companies like Clorox in the long run.
• Asia-Pacific ETF Growth (May 31): Assets in the ETF industry in the Asia-Pacific region hit a record $1.25 trillion, suggesting increased global capital flows which could indirectly support Clorox if large institutional money reallocates toward stable household names.
• Amazon’s Innovation Push (May 30): Amazon’s new ZeroOne team is inventing consumer products, which could pose long-term competitive pressure on Clorox’s branded goods in markets like home care and personal products.

Analyst Views & Fundamentals

Analysts have issued 5 "Neutral" and 1 "Sell" ratings recently, with a simple average rating score of 2.83 and a performance-weighted rating of 3.72. The dispersion in views highlights "There are differences" in institutional sentiment, with the current price trend of -2.79% not aligning with the overall neutral market expectations.

Key fundamental factors show solid performance, with an internal diagnostic score of 9.22 (on a 0-10 scale), indicating strong underlying business health:

• Net profit attributable to parent company shareholders / Net profit: 98.32% – Score: 1
• Operating cycle: 92.00 days – Score: 2
• Price-to-Sales (PS): 9.17 – Score: 3
• Quick ratio: 0.60 – Score: 0
• Profit-MV: 0.77% – Score: 1

These fundamentals suggest Clorox is maintaining profitability and asset efficiency, even as short-term technicals remain bearish.

Money-Flow Trends

Big-money flows show negative trends at the large and extra-large levels, with the overall fund-flow score of 7.86 (internal diagnostic score, 0-10) categorized as "good".

• Small, medium, and large money flows are all negative, with inflow ratios ranging from 48.56% to 49.23%, suggesting institutional caution.
• Extra-large funds, however, are positive, indicating potential buying interest from top-tier investors.

While retail and mid-sized funds are cautious, the block-inflow ratio of 49.83% suggests that large institutional flows are still relatively balanced and not entirely bearish.

Key Technical Signals

Clorox's technical indicators are currently bearish with 0 bullish and 3 bearish signals in the past 5 days. The internal diagnostic score stands at 1.44, with the following key indicators:

• WR Oversold: Score: 2.32 (internal diagnostic score) – Neutral rise signal with a 45.07% historical win rate and 71 historical signals.
• Ex-Dividend Date: Score: 1.00 (internal diagnostic score) – Biased bearish with a 25.0% win rate and -1.63% average return.
• Dividend Record Date: Score: 1.00 (internal diagnostic score) – Also biased bearish with the same performance metrics as the ex-dividend date.

Recent chart patterns include repeated WR Oversold signals from August 13 to August 22, suggesting short-term overselling may not have led to a bounce. The overall trend is weak, with the model advising to "avoid" the stock in the near term.

Conclusion

Clorox's fundamentals remain strong with an internal diagnostic score of 9.22, but its technical outlook is weak with a score of 1.44, and recent money flows are mixed.

Actionable Takeaway: Consider holding off on new long positions for now. With bearish indicators and a weak short-term trend, it might be wise to wait for a clearer breakout or stronger bullish signals before committing. For now, watch the upcoming earnings report and key earnings events for a potential catalyst.