Market is not liking Clorox's (NYSE:CLX) earnings decline as stock retreats 4.1% this week
Many investors define successful investing as beating the market average over the long term. But the risk of stock picking is that you will likely buy under-performing companies. Unfortunately, that's been the case for longer term The Clorox Company shareholders, since the share price is down 26% in the last three years, falling well short of the market return of around 19%. The falls have accelerated recently, with the share price down 14% in the last three months. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.Since Clorox has shed US$705m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One flawed but reasonable way to assess how sentiment around a company has changed is to compare th