Clorox (CLX) reports earnings tomorrow: what to expect

What happened

Clorox will report earnings Monday afternoon. Last quarter, revenue was $1.95 billion, down 2% from a year earlier. The company slightly beat profit estimates per share but missed gross margin estimates, which means the share of sales left after product costs.

Confirmed

Global impact / market context

Investors expect revenue to grow 31.3% this quarter, reversing last year's 18.9% decline. A miss could pressure the stock because Clorox rarely misses revenue estimates. Higher revenue alone may not help profit if gross margin stays weak, so cost control matters.

Analyst inference

Peers Procter & Gamble and Church & Dwight beat revenue expectations, with growth of 4% and 1%. Those results suggest household products demand held up. However, Clorox's expected 31.3% revenue growth is far above what those peers delivered.

Analyst inference

What to watch

1. Watch whether Clorox's reported revenue matches the 31.3% year-on-year growth analysts expect, after last quarter's $1.95 billion, which was down 2%. Confirmed
2. Watch gross margin, which means the share of sales left after product costs, after last quarter's miss; a weak figure could offset any revenue beat. Analyst inference
3. Watch whether Clorox's results and outlook prompt analysts to revise their estimates, since they have kept them unchanged over the last 30 days. Proposed

Evidence

• stockstory.org