Clorox (CLX) shares dropped 4% on Monday after Carl Icahn announced late Friday that he was withdrawing his proposed slate of directors for the company’s board. But Caris & Company analyst Linda Bolton Weiser upgraded the shares today to Average from Below Average as the company’s fundamentals appear to be improving and its valuation is now more attractive. Nonetheless, Weiser doesn’t think Clorox would be able to fetch much more than Icahn’s proposed $80 per share offer. The absolute maximum that Clorox could fetch would be $85, and even that seems highly unlikely, Weiser argues.
Weiser thinks Clorox is well-positioned for the current macro environment, and the company appears to be raising prices.
“CLX is an ideal stock to own in a rising U.S. dollar/falling commodities environment. CLX has only 20% of sales outside the U.S. and its Glad business is significantly exposed to plastic resin (8%-10% of total COGS). Plastic resin roughly directionally follows oil, which has dropped from about $100/ barrel in late July to about $80″
She raised her price target to $66 from $60. Clorox was trading this morning at $67 per share, up 0.8%.
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