Could This Dividend Aristocrat's Stock Be on the Up and Up?
Shares of consumer staples icon Clorox (NYSE: CLX) are down a whopping 40% or so from the peak reached in mid 2020. That was right in the middle of the pandemic, when nobody was quite sure how to handle the illness. Consumers were cleaning everything in sight, and buying more of Clorox's cleaning products. Things are very different today, with cleaning supply demand well off its peak. But management is still upbeat about the future, and cleaning is actually a key part of the story.
Consumer demand for Clorox's cleaning supplies was so intense during the early stages of the coronavirus pandemic that the company had to hire contract manufacturers to ensure it could supply retailers, its direct customers, with products. That's generally more expensive than producing products in-house, so Clorox's costs went up during this period. Because of the high demand, nobody seemed to notice or care, but this issue quickly came back to haunt the company.
Image source: Getty Images.
Source Fool.com
