Copper Hits Record, CLX - Clorox Stock Analysis, Iran On Thin Ice — Fin Mkts 5/11/26

Added: 2026-05-11

[00:00:06]Hi everybody. It's Monday, May 11th, 2026. Our first headline today is copper hits record. Copper today had an all-time high close today at $6.50.

[00:00:18]There's a lot of factors at play, obviously, including the Iran war.

[00:00:22]However, another big one that comes to mind is all of these AI data centers.

[00:00:29]It's all electric. They they need a lot of copper. There's a lot of copper involved with this. Another piece of this is simply reversion. Remember, silver, semi-precious metal, recently ballooned up to absolute record highs before popping in a bubble like fashion.

[00:00:49]Uh same thing in gold. the financial money, you know, went up to 5600 before dropping down to 4,400 quickly, but still remains very elevated alongside many other financial assets, especially growth as we've been talking about as Michael Bur now uh just mentioned, I'm sure you saw the headlines saying uh obviously referring to the extreme valuations happening in the semiconductor industry right Now, now when gold had made its historic run to the upside, the financial metal, let's got to take the log scale off here. When you compare gold to crude oil, we've been talking about this on the show, it had never been more expensive for crude oil ever. And there's two ways things can revert. You either can have gold go down or oil go up or both. And we're getting a little bit of both. Gold has mo more recently f fallen and gold uh oil sorry is up to still around $100 a barrel. So is copper joining the reversion ratio party? I mean copper to gold is still unusually uh at a pretty far extreme. As you can see from this chart, copper has almost never been more cheap to the price of gold. In fact, if gold were to stay at its current price, copper may have to double from here to get back to a historic average. So, will all things go up against the dollar?

[00:02:25]Very high inflation is admittedly one way out of the bubble. The biggest lagard right now that I see is uh still incomes. And as long as gasoline prices stay elevated, oil goes up, copper goes up, if everything goes up, you know, wages will be forced to follow. Remember Friday we got another record consumer sentiment report like lower than it's ever been.

[00:02:52]Another way out of this is prices stay high or go higher and incomes just catch up. They just uh go up and up and up.

[00:03:01]With how far and quickly financial assets have gone up, I suspect that we will get at least some reversion in price back down. But remember, Copper has a PhD in economics and is currently at all-time highs. We'll have to see if it stays that way. Second headline, CLX, Clorox Stock Analysis. Spoiler alert, I'm not interested in it until about $60 a share, but some of the big boys are becoming interested. It's a very big company that has been around a long time. It is a dividend king.

[00:03:38]From its peak, we're down 63% in price and we have not been this low in price since 2014.

[00:03:49]Quite a long time ago now. So just to walk through some of the metrics since 1983 it has been paying a dividend that has been going up nonstop just absolutely behemoth of a dividend king paying out its shareholders very nice dividends and its current dividend yield is 5.38 which is high. So then what about its PE ratio? Its current PE ratio is about 14 a.5. its earnings per share are about average right now uh compared to the past. So we can use that as you know an expected like yeah that it's really is a accurate view of the price earnings.

[00:04:35]Sometimes that can get exaggerated if earnings are especially high or especially low. And I want to point out here on this chart, if you take a look at the history of the PE ratio, um, you had very sturdy earnings per share through the 2012s, 13s, and 14s, and you can see that the price ratio has been lower. As you can see, in 2012, we were around 11 or 12 in the trailing 12-month PE ratio, and right now we're still above that. Now, if this was a McDonald's or a Nike, then I might consider a fair price to have an average uh PE of 25 of the past 10 years of earnings. Clorox definitely has moat, but I don't think it has the kind of moat that some of these other companies have. For me, it deserves even more of a discount to say UPS, which is another holding of the Rob's Child portfolio with currently a much higher dividend than 5%. So I calculate for me we recently reached down to what I consider to be a fair value of $85 a share which equals a 10 years average earnings o of $5 to uh PE ratio of 16 and a 30% discount to that which would would be dirt cheap and that's around $60.

[00:05:58]If we do continue to fall and get down to that price then I become very interested. I'll likely be buying uh about 5% of my portfolio into this company if we were to get down to that level, which would be around, you know, uh dividend yield of closer to maybe around 8% or so and then selling it when it get back to its recent low uh which I considered to be a very very conservative uh cheap fair value. Third headline today, Iran on thin ice. All over headlines, there's not a lot of details that I'm seeing coming out about what's going on. But in a nutshell, Trump says Iran's iceire is on life support. And while betting markets were betting a 50/50% chance previously of this whole thing ending by the end of May, now we only have a 20% chance and only a 40% chance by the end of June, increasing to a 70% chance by the end of December. and Trump announcing US blockade of Hormuz lifted by June 30th with a 56% chance. So on every show I say, when will the straight of Hormuz open? And my answer is never. Well, it seems to be the case still so far, which leads us straight into our community topics. What moves, if any, did you make today? Did you buy anything, sell anything? I talked about in the last show that I had purchased XLE as a 1% position. Now I've increased it to a 2% position. I got that first thing in the morning. The longer the Iran war goes on for, the worse it is for bonds and yields.

[00:07:34]Having this adds a little insurance to that position, but it also, you know, I mean, if you're going to there's two ways to handle these high gas prices.

[00:07:45]You either can complain about them or you can own you can literally own the companies that are making the profits off of those high prices. All you got to do is buy an ETF like XLE, buy the energy infrastructure, own the companies that are making the profits. I am wondering if I should uh continue to grow this position. I may do so if the Iran war isn't ending and we get another dip in XLE. XLE did rise a good amount throughout the day today. Uh but that's our community topic. What moves, if any, are you making? Did you buy anything, sell anything? comment in the comment section with the community below.

[00:08:27]Coming up tomorrow on Tuesday, we have the CPI report. That's uh an inflation gauge for consumers.

[00:08:36]And we get PPI, the producer side of inflation on Wednesday. Also coming up, end of the war, when will the straight of Hormuz open? Never. Trump tariff saga. See what happens with that. Thank you for watching, liking, subscribing, sharing, commenting, and all of your support. It's all greatly appreciated.

[00:08:52]Before we move on to the charts, one last thing uh with the end of the war in the straight of four moves. I'm seeing headlines about how Trump's about to go to China to speak with Chi again and he's bringing a bunch of his uh very wealthy buddies with him or at least inviting them. I'm uh, you know, since China's China relies on a lot of Iranian oil, you know, we can all just hope that this meeting turns into something that becomes fruitful for everyone.

[00:09:24]But time and time again, we relearn the very important lesson of not counting your eggs before or not counting your chickens before they hatch. So, let's move on to the charts. We're going to start with crude oil on Sunday night futures rose 5 a 12% backing off a little bit today but we still remain just around $100 a barrel in WTI. The S&P 500 climbed 19 basis points to all-time highs. The VIX interestingly rose today. Remember this measures specifically the volatility of the S&P 500. It's not all that common where you see the S&P 500 go up and the VIX get a bit of a jump here like we had today.

[00:10:11]Still not very high. We're below 20, but uh we rose today to 18.37.

[00:10:18]The S&P 500 rising today was almost entirely on the back of tech. Sorry, I had the wrong chart up there. We had the triple Q's going up.3%.

[00:10:29]But most of all, we had semiconductors rising another 1.72% after Friday's going up about 5%.

[00:10:39]So a very concentrated rise. The RSP actually fell five basis points today.

[00:10:45]And going through the sectors, we have XLY, sorry about that. XLY dropping 7%. This is consumer discretionary. This is a leading indicator of what is to come.

[00:11:02]The companies in XLY sell stuff that people don't need but want.

[00:11:08]We also had healthc care actually falling today a third of a percent.

[00:11:11]Consumer staples also falling almost a full percentage point. And uh we even had financials falling off a little bit 12 basis points. The 2-year Treasury note yield rose today, six basis points, now at 3.95, just a stone throw away from that, even 4%. The 10-year Treasury note yield also rose today, five basis points. Bitcoin still fighting around the top of this bare this larger bare flag. The candle that dominates this appears to be Wednesday, May 6. Still with this tail to the upside, this should be acting as pretty strong resistance until proven otherwise.

[00:11:59]Breaks bounced up today, back up a little bit. We had uh the 5-year break even inflation rate rise five basis points to 2.67% and the 10-year rising two basis points from 2.45 to 2.47%.

[00:12:15]And that's all for me and my crystal ball. I hope you enjoyed. Thank you for watching and see you next time. Rob's Child.