clorox (clx +0.74%) Last July it increased its dividend for the 48th consecutive year. Clorox has not yet announced another raise, but it is on track to achieve the 50-year dividend series sought in 2027, which would make it one. Dividend King.
Clorox’s rising dividend and its falling stock price have pushed its yield to a multi-decade high of 5.7%.
Here’s why Clorox remains committed to its dividend despite challenges in its underlying business, and why value stock A great buy right now.
Image Source: Getty Images.
Private label is a growing concern
An ongoing theme in the household and personal products industry is that private-label brands are preferred costco wholesalekirkland signature, wal-martHas great value, and marks a Sam’s Club member grab market share From name brands.
Clorox CEO Linda Rendle said the following on Clorox’s third quarter fiscal 2026 report earnings call On May 1: “But overall, private label has not had the impact that many had hoped. And I know many of you are asking questions about it. We continue to see it playing the role it normally does, which is offering lower prices to consumers who need it.”
Clorox said its private-label market share remained stable in the quarter as consumers continued to buy higher-quality brands. “But in general, consumers continue to want brands, and they want overall value, not just the lowest price,” Rendall said.
Private label is far from Clorox’s only concern. The company is facing pressure from competitors’ promotions and discounting, especially in the food category. Clorox is using product innovation, preferred shelf placement, and marketing efforts to help address these pressures. But the business is clearly being affected, as Clorox now forecasts a 9% decline in organic sales for full-year fiscal 2026, compared to a 5% to 9% decline just three months ago. This means that Clorox’s pessimistic outlook is paying off.
today’s change
(0.74%) $0.67
current price
$90.68
key data points
market cap
$11B
day limit
$89.90 -$91.17
52wk range
$84.70 -$138.94
volume
55K
average volume
2.6
gross margin
43.70%
dividend yield
5.51%
Clorox invests in improving operational efficiency
In addition to asset sales, cost cutting, pricing pressures, and intense competition, Clorox is undergoing a major Enterprise Resource Planning (ERP) overhaul.
In February, Clorox announced the completion of its five-year, $580 million ERP implementation, upgrading a more than 20-year-old system to a new one. SAP Cloud-based system that integrates financial, supply chain, and sales. The new system should make the overall business more efficient. But the change has been extremely messy, due to its impact on Clorox’s supply chain.
Clorox is pushing the right buttons to reward patient investors
Clorox’s spectacular selloff was a reminder of how much investors hate uncertainty. Management underestimated the duration and cost of the ERP transition as well as its severity slowdown in consumer spending. The company is also making major changes in its portfolio. These include the sale of its vitamins, minerals and supplements business and divestments from Argentina, Uruguay and Paraguay in calendar year 2024 and the $2.25 billion acquisition of Purell owner GOJO Industries in April this year.
In addition to these changes, Clorox has been unable to provide reliable guidance, often missing its numbers entirely or providing inconsistent guidance.
All told, the selloff in Clorox makes complete sense. But long-term investors care more about where a stock is going rather than where it has been. Clorox has potential turn around An opportunity for patient investors, especially given its cheap valuation and high yield.