Clorox (ticker: CLX) stock saw a significant jump in early trading on Thursday following the release of its quarterly financial results. The company reported earnings of 49 cents per share from $1.39 billion in revenue for the fiscal first quarter, surpassing analysts’ expectations.
Despite exceeding expectations, the earnings showed a decline compared to the previous year’s 93 cents per share. This drop can be attributed to a cyberattack that disrupted the company’s operations over the summer, resulting in a 20% decrease in revenue.
In response to the financial results, Chief Executive Linda Rendle acknowledged the impact of the cyberattack on their short-term performance. She stated, “After entering the fiscal year with solid momentum, the August cyberattack caused wide-scale disruptions that are impacting our short-term financial performance.”
As news of Clorox’s better-than-expected performance spread, shares of the company surged by 8% in premarket trading on Thursday, reaching $127.50. According to Dow Jones Market Data, this marks one of the largest post-earnings percentage increases for Clorox since 1998 when it rose by 9.9% on May 1, 2008.
Prior to this recent surge, Clorox stock had experienced an 18% decline so far this year.
Citi Analyst Upgrades Clorox Stock
Citi analyst Filippo Falorni recently upgraded his rating on Clorox stock, giving it a Buy recommendation. He also raised the target price for the stock from $135 to $150. Falorni stated that the negative impacts from the cyberattack in August are mostly behind the company. He believes that Clorox is working with its retail partners to rebuild inventories and should be able to ship ahead of consumption for the rest of the year. While full recovery will take time, Falorni is optimistic about Clorox’s future.
Clorox Lowers Sales Forecast for Fiscal 2024
Clorox has revised its forecast for sales in fiscal 2024. The company now expects a percentage decline in the mid single digits, compared to its previous projection of flat to 2% higher sales. RBC Capital Markets analyst Nik Modi, while maintaining a Sector Perform rating on the stock, highlighted that Clorox still faces consumer pressure in the current macroeconomic climate. Despite avoiding the worst-case scenario, Clorox’s net sales guidance implies a softer second half of the year than consensus expectations.
Tech Stocks Soar After Earnings
In addition to Clorox, several tech stocks have also experienced significant gains after reporting earnings. Palantir Technologies saw a 19% jump in its stock, while Fastly climbed 21% and Roku surged by 17%.