Clorox (NYSE:CLX) vs. L’Oreal (OTCMKTS:LRLCY) Financial Analysis

Clorox (NYSE:CLX) and L’Oreal (OTCMKTS:LRLCY) are both large-cap consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Valuation & Earnings

This table compares Clorox and L’Oreal”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clorox	$7.10 billion	1.90	$810.00 million	$6.52	16.98
L’Oreal	$47.06 billion	4.83	$6.93 billion	N/A	N/A

L’Oreal has higher revenue and earnings than Clorox.

Profitability

This table compares Clorox and L’Oreal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clorox	11.40%	377.86%	17.35%
L’Oreal	N/A	N/A	N/A

Insider & Institutional Ownership

78.5% of Clorox shares are held by institutional investors. Comparatively, 0.4% of L’Oreal shares are held by institutional investors. 0.6% of Clorox shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Clorox pays an annual dividend of $4.96 per share and has a dividend yield of 4.5%. L’Oreal pays an annual dividend of $1.13 per share and has a dividend yield of 1.3%. Clorox pays out 76.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Clorox has raised its dividend for 47 consecutive years. Clorox is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Clorox has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500. Comparatively, L’Oreal has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Clorox and L’Oreal, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clorox	4	12	1	0	1.82
L’Oreal	2	4	1	2	2.33

Clorox presently has a consensus target price of $130.20, suggesting a potential upside of 17.59%. Given Clorox’s higher possible upside, equities research analysts clearly believe Clorox is more favorable than L’Oreal.

Summary

Clorox beats L’Oreal on 8 of the 15 factors compared between the two stocks.

About Clorox

The Clorox Company manufactures and markets consumer and professional products worldwide. It operates through four segments: Health and Wellness, Household, Lifestyle, and International. The Health and Wellness segment offers cleaning products, such as laundry additives and home care products primarily under the Clorox, Clorox2, Scentiva, Pine-Sol, Liquid-Plumr, Tilex, and Formula 409 brands; professional cleaning and disinfecting products under the CloroxPro and Clorox Healthcare brands; professional food service products under the Hidden Valley brand; and vitamins, minerals and supplement products under the RenewLife, Natural Vitality, NeoCell, and Rainbow Light brands in the United States. The Household segment provides cat litter products under the Fresh Step and Scoop Away brands; bags and wraps under the Glad brand; and grilling products under the Kingsford brand in the United States. The Lifestyle segment offers dressings, dips, seasonings, and sauces primarily under the Hidden Valley brand; natural personal care products under the Burt's Bees brand; and water-filtration products under the Brita brand in the United States. The International segment provides laundry additives; home care products; water-filtration systems; digestive health products; grilling products; cat litter products; food products; bags and wraps; natural personal care products; and professional cleaning and disinfecting products internationally primarily under the Clorox, Ayudin, Clorinda, Poett, Pine-Sol, Glad, Brita, RenewLife, Ever Clean and Burt's Bees brands. It sells its products primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet, and military stores; third-party and owned e-commerce channels; and distributors, as well as a direct sales force The Clorox Company was founded in 1913 and is headquartered in Oakland, California.

About L’Oreal

L'Oréal S.A., through its subsidiaries, manufactures and sells cosmetic products for women and men worldwide. The company operates through four divisions: Consumer Products, L'oréal Luxe, Professional Products, and Dermatological Beauty. It offers skincare, make-up, hair colourants, haircare, perfumes, and hygiene products. The company provides its products under the L'Oréal Paris, Garnier, Maybelline New York, NYX Professional Makeup, Stylenanda, Essie, Dark & Lovely, Mixa, Magic Mask, Niley, Lancôme, Yves Saint Laurent, Armani, Kiehl's Since 1851, Helena Rubinstein, Biotherm, Shu Uemura, IT Cosmetics, Ralph Lauren Fragrance, Urban Decay, Mugler, Valentino, Viktor&Rolf, Azzaro, Prada, Cacharel, Maison Margela Fragrance, Diesel, Yue Sai, Atelier Colonge, Carita, Takami, Aesop, L'Oréal Professionnel Paris, Kérastase, Redken, Matrix, Pureology, Pulp Riot, La Roche-Posay, Vichy, CeraVe, SkinCeuticals, and Skinbetter Science brands. It sells its products through distribution channels, such as hair salons, local stores, e-commerce, travel retail, mass market retail, department store perfumeries, pharmacies, drug stores, medi-spas, and free-standing stores. L'Oréal S.A. was founded in 1909 and is headquartered in Clichy, France.