Shares of boring old consumer products company Clorox (CLX -0.69%) exploded today after the company reported its fiscal 2024 first-quarter earnings last night. The stock jumped as much as almost 11% this morning, and shares were still higher by 8% at 2:30 p.m ET.
Cyberattack rebound
Clorox stock normally has low volatility relative to the overall market. It has a beta coefficient of less than 0.5, meaning the stock is typically less than half as volatile as the overall market. But a recent cyberattack has been on the forefront of shareholders' minds, and the latest earnings report is resulting in somewhat of a sigh of relief. Today's move is being made on trading volume that is more than 150% above average.
A cyberattack in August resulted in production delays and disrupted supplies and operations. That led to a 20% decrease in sales for the quarterly period ended Sept. 30. Diluted net earnings per share plummeted by 75% year over year.
But the maker of popular cleaning products beat analyst estimates by still reporting a profit on higher-than-expected revenue when Wall Street expected a quarterly loss. CEO Linda Rendle addressed the bad news head on, stating, "After entering the fiscal year with solid momentum, the August cyberattack caused wide-scale disruptions that are impacting our short-term financial performance."
One analyst says it's time to buy
With the worst behind it, Citigroup analyst Filippo Falorni thinks it's time to buy Clorox stock and has raised his price target to $150 per share today, reports Barron's. That is up from a previous target of $135 per share and represents a 30% jump over yesterday's closing price.
Clorox shares were down nearly 25% since the cyberattack announcement before today's spike. Investors looking for a normally low-volatility stock that still pays a more than 3.8% dividend yield at the most recent price could find that bargain hunting here will pay off over the long run.
