Key Stats for Clorox Stock
- 1- Year Price Change for Clorox stock: 17%
- $CLX Share Price as of Jan. 21: $112
- 52-Week High: $164
- $CLX Stock Price Target: $120
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What Happened?
Clorox (CLX) stock is making headlines after the cleaning products giant announced a $2.25 billion deal to acquire GOJO Industries, the company behind Purell hand sanitizer. The transaction values GOJO at $1.92 billion after accounting for $330 million in anticipated tax benefits.
- GOJO has built Purell into the #1 hand sanitizer brand in America across both retail stores and business-to-business channels.
- The 80-year-old family-owned company generates nearly $800 million in annual sales and has grown consistently at a mid-single-digit pace, with a 5% compound annual growth rate over the past three years.
What makes GOJO attractive is its business model. More than 80% of revenue comes through B2B distributors serving hospitals, schools, offices, and other facilities.
The company has roughly 20 million soap and sanitizer dispensers installed across these locations, generating recurring revenue as customers refill the products.
Clorox CEO Linda Rendle emphasized the strategic fit: “This is a compelling acquisition that evolves our portfolio and scales our fastest-growing, most profitable operating segment—Health and Wellness.”
The deal allows Clorox to double down on what’s working.
The company’s Health and Wellness segment has delivered a 4% compound annual growth rate over the past decade, making it Clorox’s largest and most profitable business.
GOJO immediately expands this franchise while adding complementary B2B capabilities.
Clorox plans to fund the acquisition primarily through debt.
The company expects the deal to close by the end of fiscal 2026, subject to regulatory approvals. Management reaffirmed its fiscal 2026 financial outlook, excluding the impact of the transaction.
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What the Market Is Telling Us About Clorox Stock
Clorox stock investors now have a clearer picture of management’s portfolio strategy. After recently divesting its vitamins business, the company is reinvesting proceeds into its core strength: health and hygiene products, where brand trust matters most.
The strategic logic is compelling.
Clorox brings world-class marketing, consumer insights, innovation capabilities, and deep retailer relationships.
GOJO brings state-of-the-art manufacturing, over 680 global patents, cutting-edge dispenser technology, and established B2B distribution networks. These are highly complementary strengths.
On the retail side, the opportunity is significant.
- Despite being the leading national brand, Purell has just 14% household penetration and has received limited marketing investment.
- That’s because GOJO focused resources on the more profitable B2B channel.
- Clorox can now unleash its marketing machine to drive retail growth, while GOJO’s team continues to build the B2B business.
The B2B cross-selling potential is equally attractive. Clorox already has a strong professional business selling cleaning and disinfecting products.
GOJO dominates hand hygiene. Together, they can offer an integrated solution that increases wallet share with hospitals, schools, and other institutional customers.
Financially, the deal is structured conservatively. Clorox expects at least $50 million in annual cost synergies from combining operations, procurement, logistics, and other functions.
The transaction will be EPS-neutral in year one and accretive in year two. Management projects that the combined business will grow in the mid-to-high single digits, adding 30 to 50 basis points to Clorox’s overall growth rate.
The main risk is execution. Clorox hasn’t made a major acquisition in years, and integrating an $800 million business with different channels and capabilities won’t be simple.
Management addressed this directly, noting they’ve been building integration capabilities and have developed a disciplined plan.
Debt levels will also rise. Clorox plans to use debt financing, which will require focusing on deleveraging rather than share buybacks in the near term.
But the company generates strong cash flow, and GOJO’s stable recurring revenue model supports debt paydown.
For Clorox stock, this deal represents a bet that consolidating leadership in health and hygiene creates more value than diversifying into unrelated categories. Given the segment’s track record and favorable tailwinds around hygiene awareness, that bet looks reasonable.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
