Contrasting Clorox (NYSE:CLX) and Reynolds Consumer Products (NASDAQ:REYN)

Clorox (NYSE:CLX) and Reynolds Consumer Products (NASDAQ:REYN) are both consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, profitability, dividends and risk.

Institutional & Insider Ownership

78.5% of Clorox shares are held by institutional investors. Comparatively, 26.8% of Reynolds Consumer Products shares are held by institutional investors. 0.5% of Clorox shares are held by insiders. Comparatively, 0.4% of Reynolds Consumer Products shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for Clorox and Reynolds Consumer Products, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clorox	4	12	0	0	1.75
Reynolds Consumer Products	0	7	1	0	2.12

Clorox currently has a consensus price target of $93.29, suggesting a potential upside of 3.61%. Reynolds Consumer Products has a consensus price target of $24.60, suggesting a potential downside of 0.20%. Given Clorox’s higher possible upside, equities research analysts plainly believe Clorox is more favorable than Reynolds Consumer Products.

Earnings and Valuation

This table compares Clorox and Reynolds Consumer Products”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clorox	$6.72 billion	1.62	$587.00 million	$4.82	18.68
Reynolds Consumer Products	$3.72 billion	1.40	$301.00 million	$1.64	15.03

Clorox has higher revenue and earnings than Reynolds Consumer Products. Reynolds Consumer Products is trading at a lower price-to-earnings ratio than Clorox, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Clorox has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, Reynolds Consumer Products has a beta of 0.55, meaning that its share price is 45% less volatile than the S&P 500.

Profitability

This table compares Clorox and Reynolds Consumer Products’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clorox	8.74%	522.23%	10.64%
Reynolds Consumer Products	9.11%	16.03%	7.28%

Dividends

Clorox pays an annual dividend of $5.00 per share and has a dividend yield of 5.6%. Reynolds Consumer Products pays an annual dividend of $0.92 per share and has a dividend yield of 3.7%. Clorox pays out 103.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Reynolds Consumer Products pays out 56.1% of its earnings in the form of a dividend. Clorox has raised its dividend for 47 consecutive years. Clorox is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Clorox beats Reynolds Consumer Products on 13 of the 17 factors compared between the two stocks.

About Clorox

The Clorox Company manufactures and markets consumer and professional products worldwide. It operates through four segments: Health and Wellness, Household, Lifestyle, and International. The Health and Wellness segment offers cleaning products, such as laundry additives and home care products primarily under the Clorox, Clorox2, Scentiva, Pine-Sol, Liquid-Plumr, Tilex, and Formula 409 brands; professional cleaning and disinfecting products under the CloroxPro and Clorox Healthcare brands; professional food service products under the Hidden Valley brand; and vitamins, minerals and supplement products under the RenewLife, Natural Vitality, NeoCell, and Rainbow Light brands in the United States. The Household segment provides cat litter products under the Fresh Step and Scoop Away brands; bags and wraps under the Glad brand; and grilling products under the Kingsford brand in the United States. The Lifestyle segment offers dressings, dips, seasonings, and sauces primarily under the Hidden Valley brand; natural personal care products under the Burt's Bees brand; and water-filtration products under the Brita brand in the United States. The International segment provides laundry additives; home care products; water-filtration systems; digestive health products; grilling products; cat litter products; food products; bags and wraps; natural personal care products; and professional cleaning and disinfecting products internationally primarily under the Clorox, Ayudin, Clorinda, Poett, Pine-Sol, Glad, Brita, RenewLife, Ever Clean and Burt's Bees brands. It sells its products primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet, and military stores; third-party and owned e-commerce channels; and distributors, as well as a direct sales force The Clorox Company was founded in 1913 and is headquartered in Oakland, California.

About Reynolds Consumer Products

Reynolds Consumer Products Inc. produces and sells products in cooking, waste and storage, and tableware product categories in the United States and internationally. It operates through four segments: Reynolds Cooking & Baking, Hefty Waste & Storage, Hefty Tableware, and Presto Products. The Reynolds Cooking & Baking segment produces aluminum foil, disposable aluminum pans, parchment paper, freezer paper, wax paper, butcher paper, plastic wrap, baking cups, oven bags, and slow cooker liners under the Reynolds Wrap, Reynolds KITCHENS, and EZ Foil brands in the United States, as well as under the ALCAN brand in Canada and under the Diamond brand internationally. The Hefty Waste & Storage segment offers trash bags under the Hefty Ultra Strong and Hefty Strong brands; and food storage bags under the Hefty and Baggies brands. This segment also provides a suite of products, including compostable bags, bags made from recycled materials, and the orange bags. The Hefty Tableware segment offers disposable and compostable plates, bowls, platters, cups, and cutlery under the Hefty brand. The Presto Products segment primarily sells store brand products in food storage bags, trash bags, reusable storage containers, and plastic wrap categories. It offers both branded and store brand products to grocery stores, mass merchants, warehouse clubs, discount chains, dollar stores, drug stores, home improvement stores, military outlets, and eCommerce retailers. The company was founded in 1947 and is headquartered in Lake Forest, Illinois. Reynolds Consumer Products Inc. is a subsidiary of Packaging Finance Limited.