The Clorox Company
) is scheduled to report its third-quarter fiscal 2014 results on
May 1. Last quarter, this consumer products company posted a
negative earnings surprise of approximately 3.30%. Let's see how
things are shaping up for this announcement.
Factors in the Past Quarter
Clorox posted lower-than-anticipated earnings results for
second-quarter fiscal 2014 as the negative impact from adverse
foreign currency exchange rates and higher manufacturing and
logistics costs as well as commodity costs more than offset the
increased pricing, higher volume and effective cost management.
On the other hand, net sales improved backed by the increased
pricing and higher volumes that were partially offset by currency
translations as well as unfavorable product mix.
Additionally, the company lowered its sales and earnings
forecasts for fiscal 2014 anticipating pressures from unfavorable
foreign currency exchange rates and increased commodity costs.
The company expects sales to grow in the range of 1%-2%, instead
of 2%-3% projected earlier. Further, earnings per share are now
expected to be $4.40-$4.55, down from the earlier forecast of
Our proven model does not conclusively project Clorox as likely
to beat earnings this quarter. A stock needs to have both a
and a Zacks Rank #1, 2 or 3 to surpass earnings estimates.
However, this is not the case here due to the following factors:
ESP for Clorox is 0.00% since the Most Accurate estimate stands
at $1.08 per share, which is in line with the Zacks Consensus
Zacks Rank #4 (Sell):
Clorox's Zacks Rank #4 when combined with 0.00% ESP makes
surprise prediction difficult. We caution against stocks with a
Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings
announcement, especially when the company is seeing negative
estimate revisions momentum.
Stocks that Warrant a Look
Here are some other companies you may want to consider as our
model shows they have the right combination of elements:
The Walt Disney Company
) Earnings ESP stands at +1.03% and it carries a Zacks Rank #2
Church & Dwight Co. Inc.
) has an Earnings ESP of +1.37% and a Zacks Rank #3 (Hold).
The Allstate Corporation
) with an Earnings ESP of +0.88% holds a Zacks Rank #3
ALLSTATE CORP (ALL): Free Stock Analysis
CHURCH & DWIGHT (CHD): Free Stock Analysis
CLOROX CO (CLX): Free Stock Analysis Report
DISNEY WALT (DIS): Free Stock Analysis Report
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