$CLX long-term buy! (4/5)

NYSE:CLX   Clorox Company (The)
Conviction: 4/5
Entry is not idea, could have better entry point if price goes down to retest support.

Main thesis
  • Bounced off long-term (1991) channel bottom in December
  • Bounced off 50M-MAas well
  • RSI-M also bounced off historical lows, although not levels with highest certainty
  • Confirmed breakthrough from downward resistance line last week
  • Touching lower bound of channel (2016)

Misc Info
  • P/S level of 3ish is high relative to historical levels, however much lower than some other tech companies...
  • P/S level of 3 is about the same as S&P 500
  • Healthcare ( XLV ) looks good compared to SPY , could carry this up as well

Potential Risks
  • RSI-W is heating up, although does not preclude from uptrend in medium term (about a year)
  • Just broke through (with confirmed close) last week from downtrend resistance line
  • Quick ratio is deteriorating from mid 2021
  • General markets are very expensive, and we all know correlation goes to 1 in selloff.
  • Revenue growth is negative ... likely as people become less sensitive to COVID?


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