Clorox (NYSE:CLX) versus Church & Dwight (NYSE:CHD) Critical Survey

Clorox (NYSE:CLX) and Church & Dwight (NYSE:CHD) are both large-cap consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

Dividends

Clorox pays an annual dividend of $5.00 per share and has a dividend yield of 5.6%. Church & Dwight pays an annual dividend of $1.23 per share and has a dividend yield of 1.1%. Clorox pays out 103.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Church & Dwight pays out 39.5% of its earnings in the form of a dividend. Clorox has raised its dividend for 47 consecutive years and Church & Dwight has raised its dividend for 29 consecutive years. Clorox is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Clorox and Church & Dwight”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clorox	$6.72 billion	1.62	$587.00 million	$4.82	18.68
Church & Dwight	$6.20 billion	4.22	$736.80 million	$3.11	35.50

Church & Dwight has lower revenue, but higher earnings than Clorox. Clorox is trading at a lower price-to-earnings ratio than Church & Dwight, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and target prices for Clorox and Church & Dwight, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clorox	4	12	0	0	1.75
Church & Dwight	1	8	8	0	2.41

Clorox presently has a consensus price target of $93.57, suggesting a potential upside of 3.92%. Church & Dwight has a consensus price target of $106.94, suggesting a potential downside of 3.14%. Given Clorox’s higher possible upside, analysts clearly believe Clorox is more favorable than Church & Dwight.

Insider & Institutional Ownership

78.5% of Clorox shares are held by institutional investors. Comparatively, 86.6% of Church & Dwight shares are held by institutional investors. 0.5% of Clorox shares are held by company insiders. Comparatively, 1.2% of Church & Dwight shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Clorox and Church & Dwight’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clorox	8.74%	522.23%	10.64%
Church & Dwight	12.41%	20.28%	9.49%

Volatility & Risk

Clorox has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500. Comparatively, Church & Dwight has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500.

Summary

Church & Dwight beats Clorox on 9 of the 17 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 Church & Dwight

Church & Dwight Co., Inc. engages in the development, manufacture, and marketing of household, personal care, and specialty products. It operates through the following segments: Consumer Domestic, Consumer International, Specialty Products Division (SPD), and Corporate. The Consumer Domestic segment offers household products, such as laundry detergents, fabric softener sheets, cat litter, household cleaning products, and personal care products including antiperspirants, oral care products, depilatories, reproductive health products, oral analgesics, nasal saline moisturizers, and dietary supplements. The Consumer International segment is involved in the personal care, household and over-the-counter products in international subsidiary markets, including Australia, Canada, France, Germany, Japan, Mexico, China, and the United Kingdom. The SPD segment consists of sales to businesses and participates in three product areas namely, animal nutrition, specialty chemicals, and commercial and professional. The Corporate segment includes equity in earnings of affiliates. The company was founded by Dwight John and Austin Church in 1846 and is headquartered in Ewing, NJ.