We recently released a list 15 Best High-yield Dividend Stocks in 2025 and beyond. In this article, we will look at the position of Clorox Company (NYSE:CLX) with other best high-yield dividend stocks.
Over the years, stocks that pay dividends have become increasingly popular as investors tend to invest in income-focused investment strategies. Many conservative investors have pledged hundreds of billions of dollars in numerous funds because it is believed that companies that continue to raise dividends tend to bring the strongest long-term market performance.
According to Ed Clissold, researched by Ned Davis, 80% of companies in the wider market are currently paying dividends, with 324 of them starting or increasing spending in the past year. Interestingly, it was the earlier research of Clissold's company that helped spark widespread interest in dividend growth stocks. The study is based on an older method of return calculation that has been widely replicated, highlighting the strong performance of companies that regularly increase dividends.
But as the company has updated its approach to industry changes, the results show that while dividend growers perform well, it may make more sense to focus on high-yield dividend stocks. Since 1973, this yield-based strategy has outperformed dividend growers in both rising and falling markets. Financial advisers believe that investors first need to check the dividend yield of the stock, which is determined by dividing the annual dividend by the stock's current price. This figure shows the income investor invests in stocks per dollar.
However, high dividend yields tend to lead to higher volatility and more frequent portfolio turnover. This is not always a positive signal. Sometimes it can mark trouble, especially when stock prices are driven by a drop in value. In these cases, companies may reduce the risk of their dividend payments, which usually occur during financial stress. The consultant stressed the need to go beyond the surface level metrics and examined the company’s core finances to assess its overall stability and strength. Jason Alonzo, managing director of Harbor Capital Advisors, commented on investing in dividend stocks:
“Ensure that the company has a strong balance sheet and the prospect of EPS growth is strong, so even with a recession, the company has a good place to maintain dividend payments in the future.”
While the debate between dividend growth and high yields continues, analysts stress that dividend stocks are not all the same. Stocks that offer stable output as well as stable dividends often reflect strong fundamentals because they believe the company can reward shareholders while still investing in future growth. Dividend payment ratios play a crucial role in evaluating the flexibility of a company's dividend policy. Companies that use almost all of their revenue to pay dividends, or earn little to no income to maintain these dividends, may face challenges, especially under competitive pressures, which are unable to operate support due to limited cash flows.
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In this article, we use screeners to identify dividend companies with higher than average dividend yields. From there, we chose companies that increased their spending for 10 consecutive years, which demonstrated their long-term growth. Finally, as of May 9, we selected 15 stocks with the highest dividend yield and ranked them accordingly.
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As of May 9: 3.62%
Clorox Corporation (NYSE:CLX) is a California-based company specializing in the manufacturing and marketing of consumer and professional products. The company recently reported its third-quarter fiscal 2025 earnings, which failed to meet expectations from investors and analysts. The reasons for lower sales than expected are the challenging and turbulent consumer and geopolitical environment.
Clorox (NYSE:CLX) reported revenue of $1.67 billion, down 8% from the same period last year. Its revenue and $1.45 in revenue and earnings per share missed the analyst consensus of $49.03 million and $0.11, respectively. The organic volume remains the same, mainly due to the decrease in consumer demand in several segments of the company. Meanwhile, gross margin rose by 240 basis points, up from 42.2% in the same period last year to 44.6%. This increase is mainly attributed to cost-saving plans and the positive impact of the sale of its VMs and Argentina operations.
Clox Corporation (NYSE:CLX)'s cash position remained stable as the company ended the quarter with $226 million in cash and cash equivalents. In addition, it generated $687 million in operating cash flow YTD, a 94% increase over the previous year. The company's quarterly dividend was $1.22 per share and increased spending for 22 consecutive years. CLX has a dividend yield of 3.62% as of May 9, making it one of the best dividends on our list.
Overall, CLX Ranked 13th On our list of the best high yield dividend stocks. While we acknowledge the potential of CLX as an investment, our belief is that some undervalued dividend stocks have greater hope of offering higher returns and do so in a shorter time frame. If you are looking for more promising undervalued dividend stocks than CLX, but earning 10 times each year, growing in double-digit revenue each year, check out our report Dirt cheap dividend stocks.
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Disclosure: None. This article was originally published in Inside monkey.