Financial Analysis: Clorox Company (The) (NYSE:CLX) versus Zep (ZEP)

Zep (NYSE: ZEP) and Clorox Company (The) (NYSE:CLX) are both non-cyclical consumer goods & services companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitabiliy.

Dividends

Clorox Company (The) pays an annual dividend of $3.20 per share and has a dividend yield of 2.4%. Zep does not pay a dividend. Clorox Company (The) pays out 63.1% of its earnings in the form of a dividend. Zep has raised its dividend for 39 consecutive years and Clorox Company (The) has raised its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of current ratings and recommmendations for Zep and Clorox Company (The), as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zep 0 0 0 0 N/A
Clorox Company (The) 0 10 2 0 2.17

Clorox Company (The) has a consensus price target of $126.00, suggesting a potential downside of 4.47%. Given Clorox Company (The)’s higher probable upside, analysts plainly believe Clorox Company (The) is more favorable than Zep.

Insider & Institutional Ownership

70.8% of Clorox Company (The) shares are held by institutional investors. 0.7% of Clorox Company (The) shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Zep and Clorox Company (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zep 0.10% 0.34% 0.12%
Clorox Company (The) 11.22% 215.99% 14.97%

Valuation and Earnings

This table compares Zep and Clorox Company (The)’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Zep N/A N/A N/A N/A N/A
Clorox Company (The) $5.93 billion 2.86 $1.22 billion $5.07 26.02

Clorox Company (The) has higher revenue and earnings than Zep.

Summary

Clorox Company (The) beats Zep on 9 of the 11 factors compared between the two stocks.

Zep Company Profile

Zep Inc. is a consumable chemical packaged goods company, providing a variety of chemicals and related products and services that help professionals maintain, clean and protect their assets. The Company markets its products and services under brand names, including Zep, Zep Professional, Zep Commercial, Zep Automotive and other Zep Inc. brands. Its product portfolio, which is produced using more than 4,000 formulations, includes anti-bacterial and industrial hand care products, cleaners, degreasers, deodorizers, disinfectants, floor finishes, sanitizers, pest- and weed-control products, air-care products and delivery systems and a variety of automotive maintenance chemicals. The Company manufactures its products at nine facilities located in the United States, Canada, the Netherlands, Italy, and United Kingdom.

Clorox Company (The) Company Profile

The Clorox Company is a manufacturer and marketer of consumer and professional products. The Company sells its products primarily through mass retail outlets, e-commerce channels, wholesale distributors and medical supply distributors. The Company operates through four segments: Cleaning, Household, Lifestyle and International. Its Cleaning segment consists of laundry, home care and professional products marketed and sold in the United States. Its Household segment consists of charcoal, cat litter and plastic bags, wraps and container products marketed and sold in the United States. Its Lifestyle segment consists of food products, water-filtration systems and filters, and natural personal care products marketed and sold in the United States. Its International segment consists of products sold outside the United States. It markets some of the consumer brand names, such as namesake bleach and cleaning products, Pine-Sol cleaners, Liquid-Plumr clog removers and Kingsford charcoal.

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