What happened

Shares of Clorox (CLX -0.75%) surged by 42.9% in the first six months of 2020, according to data from S&P Global Market Intelligence.

The stock got a big boost this year from the COVID-19 pandemic and has hit an all-time high of $219 at end-June.

Mop with pail of water and cleaning solutions

Image source: Getty Images.

So what

Clorox has, for many decades, been supplying a wide range of cleaning and household products for use in homes and offices. The company generated $6.2 billion in net sales in the fiscal year 2019, is present in more than 100 markets, and employs 8,800 people. Nearly 80% of Clorox's global portfolio is No. 1 or No. 2 in market share and includes popular brands such as Clorox, Glad, and Pine-Sol.

The company has a long track record of dividend growth, with dividend per share more than quadrupling from $0.81 in 2000 to $3.94 in 2019. Clorox was already doing well before the pandemic hit, but its business got an even stronger boost as a result of COVID-19. For the first quarter of 2020, net sales increased by 15% year over year, while net income jumped almost 29% year over year. This growth rate was significantly higher than the annual revenue growth of 1% and 3% year over year for the fiscal years 2019 and 2018, respectively. The main driver for this growth was the 32% year-over-year increase in the sales of cleaning products, as more businesses and household adopt higher standards of cleanliness in the wake of the pandemic.

Now what

CEO Benno Dorer mentioned during the company's earnings conference call that COVID-19 will continue to affect consumer behavior and that new households have been purchasing Clorox's products in various categories. The heightened awareness of disinfection also represents a long-term, enduring growth trend that the company can latch onto, as Clorox is the most trusted brand in the U.S. home care category.

The company also has its "IGNITE" strategy in place to position for long-term growth. The strategy involves growing revenue across its brands, innovating shopping experiences, and evolving its portfolio of brands. With strong growth tailwinds in the cleaning industry, the company's overall financial performance should continue to improve in future years.