Using an unlevered Free Cash Flow to Firm (FCFF) model, we project The Clorox Company's cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -8.4% to 2.7% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 35, DPO 81, DIO 58). At a 6.3% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 14.0x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $114.58 per share, suggesting CLX is fairly valued by 11.4% at the current price of $102.87.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 787 | 846 | 877 | 924 | 949 | 973 |
| (−) Net Interest | 90 | 97 | 100 | 105 | 108 | 111 |
| (+) D&A | 248 | 227 | 225 | 229 | 239 | 245 |
| EBITDA | 1,125 | 1,170 | 1,202 | 1,259 | 1,297 | 1,329 |
| (−) Tax | 197 | 212 | 219 | 231 | 237 | — |
| (−) CapEx | 224 | 241 | 250 | 263 | 270 | — |
| (−) ΔWC | -124 | 29 | 15 | 23 | 12 | — |
| Free Cash Flow (FCF) | 828 | 688 | 718 | 742 | 777 | — |
| Peers' EBITDA Multiple | 14.0x | |||||
| Terminal Value | 18,599 | |||||
| WACC / Discount Rate | 6.28% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 804 | 628 | 617 | 599 | 591 | 13,714 |
| Enterprise Value | 16,953 | |||||
| Projection Period | 3,239 | 19.1% | ||||
| Terminal Value | 13,714 | 80.9% | ||||
| (−) Current Net Debt | 2,713 | |||||
| Equity Value | 14,240 | |||||
| (÷) Outstanding Shares | 124M | |||||
| Fair Price | $115 | +11.4% | ||||
| WACC \ EV/EBITDA Exit Multiple | 10.0x | 12.0x | 14.0x | 16.0x | 18.0x |
|---|---|---|---|---|---|
| 4.3% | $92 | $109 | $127 | $144 | $161 |
| 5.3% | $87 | $104 | $121 | $137 | $154 |
| 6.3% | $83 | $99 | $115 | $130 | $146 |
| 7.3% | $79 | $94 | $109 | $124 | $139 |
| 8.3% | $75 | $89 | $104 | $118 | $132 |
Current price: $102.87. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.