Critical Contrast: Clorox (NYSE:CLX) vs. Ollie’s Bargain Outlet (NASDAQ:OLLI)

Clorox (NYSE:CLX) and Ollie’s Bargain Outlet (NASDAQ:OLLI) are both consumer staples companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings for Clorox and Ollie’s Bargain Outlet, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clorox	4	11	1	0	1.81
Ollie’s Bargain Outlet	0	4	12	0	2.75

Clorox presently has a consensus target price of $118.73, indicating a potential downside of 6.72%. Ollie’s Bargain Outlet has a consensus target price of $142.14, indicating a potential upside of 32.72%. Given Ollie’s Bargain Outlet’s stronger consensus rating and higher possible upside, analysts plainly believe Ollie’s Bargain Outlet is more favorable than Clorox.

Volatility and Risk

Clorox has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, Ollie’s Bargain Outlet has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.

Valuation and Earnings

This table compares Clorox and Ollie’s Bargain Outlet”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clorox	$7.10 billion	2.17	$810.00 million	$6.12	20.80
Ollie’s Bargain Outlet	$2.27 billion	2.89	$199.76 million	$3.62	29.59

Clorox has higher revenue and earnings than Ollie’s Bargain Outlet. Clorox is trading at a lower price-to-earnings ratio than Ollie’s Bargain Outlet, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Clorox and Ollie’s Bargain Outlet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clorox	11.17%	383.01%	14.57%
Ollie’s Bargain Outlet	8.81%	12.86%	8.29%

Insider & Institutional Ownership

78.5% of Clorox shares are held by institutional investors. 0.6% of Clorox shares are held by company insiders. Comparatively, 0.9% of Ollie’s Bargain Outlet shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Clorox beats Ollie’s Bargain Outlet on 8 of the 14 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 Ollie’s Bargain Outlet

Ollie’s Bargain Outlet Holdings, Inc. is a holding company, which engages in the retail of closeouts, excess inventory, and salvage merchandise. It offers overstocks, package changes, manufacturer refurbished goods, and irregulars. The company’s products include housewares, food, books and stationery, bed and bath, floor coverings, electronics and toys. Ollie’s Bargain Outlet Holdings was founded by Mark Butler, Mort Bernstein, Oliver Rosenberg and Harry Coverman on July 29, 1982, and is headquartered in Harrisburg, PA.