What Happened:

Shares of consumer products giant Clorox (NYSE:CLX) fell 7.4% in the morning session after the company reported first-quarter results, which missed analysts' revenue expectations, as sales declined in absolute terms. The weak topline performance was attributed to lower volume from temporary distribution losses due to disruptions caused by the cyberattack. Management also called out unfavorable foreign exchange rates. 

On the other hand, EPS exceeded analysts' expectations as gross margin improved due to improved pricing and cost savings. Looking ahead, guidance was mixed: While EPS guidance came in ahead of consensus estimates, the company actually lowered its full year organic revenue growth outlook. Overall, the results could have been better.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Clorox? Access our full analysis report here, it's free.

What is the market telling us:

Clorox's shares are not very volatile than the market average and over the last year have had only 4 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. 

The biggest move we wrote about over the last year was 3 months ago, when the stock gained 8.7% on the news that the company reported second-quarter results that blew past analysts' EPS expectations, although some large one-time charges that were added back to arrive at adjusted EPS (non-GAAP) likely made it difficult for Wall Street to model and project. Its revenue and gross margin also outperformed estimates. Zooming out, this was an impressive quarter that should delight shareholders.

Clorox is down 2.5% since the beginning of the year, and at $141.20 per share it is trading 19.6% below its 52-week high of $175.61 from May 2023. Investors who bought $1,000 worth of Clorox's shares 5 years ago would now be looking at an investment worth $952.55.

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