Clorox Projects Strong Sales Growth for Fiscal 2027, Beating Estimates

Clorox (NYSE: CLX) on Monday issued an upbeat annual sales forecast, projecting stronger growth than Wall Street expected, as the company anticipates sustained demand for its health and wellness products and from its international business.

Upbeat Outlook and Quarterly Results

The maker of Pine-Sol and other cleaning products said it expects net sales for fiscal year 2027 to increase between 13% and 14%. This forecast is above the average analyst estimate of a 12.8% rise, according to LSEG data. However, its guidance for adjusted earnings was mixed, with a projected range of $5.70 to $6.00 per share, compared to a consensus estimate of $5.97.

For the fourth quarter ended June 30, the company reported:

• Net sales of $1.95 billion, a 2% decrease from the prior year but ahead of the $1.90 billion analysts had forecast.
• Adjusted earnings of $1.66 per share, narrowly beating estimates of $1.65.

Margin Pressure and CEO Commentary

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Despite the positive sales outlook, Clorox faced significant margin compression in the fourth quarter. The company's quarterly gross margin fell by 520 basis points year-over-year to 41.3%, signaling rising costs.

CEO Linda Rendle acknowledged the difficult market conditions in a statement. She said the company expects the "operating environment to remain challenging, with continued cost volatility and a value-seeking consumer."

Strategic Context

The optimistic sales forecast is partly based on continued consumer purchasing of essential items like disinfectants and surface cleaners. To further expand its footprint in the health and hygiene market, Clorox acquired Purell manufacturer GOJO Industries for $2.25 billion in April.