Clorox consistently averages a return on capital greater than 20%
Clorox$Clorox(CLX)$ consistently averages a return on capital greater than 20%
Does this make it an attractive compounder? CLX has a high payout ratio. In 2022 it’s EPS was $3.73 and it’s dividend was $4.64
This keeps invested capital low and ROC high, despite only a 2.4% FCF growth rate
It’s not retaining and reinvesting high levels of its profits, so for long term growth probably no. But if you need steady dividends, then probably yes.
Isn't there a few companies that don't need to reinvest capital to grow. Visa$Visa(V)$ and MasterCard$MasterCard(MA)$ are great examples
https://twitter.com/long_equity/status/1609669111558144005
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Kl is cooling