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Scotts Miracle-Gro Company
(NYSE:SMG)
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Rating:66Neutral
Price Target:
$72.00
▲(9.02% Upside)
Action:Reiterated
Date:05/09/26
The score is driven by improving fundamentals (profit and margin recovery plus strong free cash flow) and very compelling valuation (low P/E and solid dividend). Offsetting these positives are elevated balance-sheet risk (negative equity/high debt) and currently weak technical momentum, while earnings-call commentary is constructive but highlights commodity-cost uncertainty and higher SG&A.
Positive Factors
Strong free cash flow generation
Persistent positive and improving free cash flow (TTM ~$380M) provides durable internal funding for capex, share repurchases, and deleveraging. Reliable cash conversion supports strategic initiatives and cushions the business against cyclical top-line swings and working-capital volatility.
Negative Factors
Negative equity and elevated leverage
Persistently negative shareholders’ equity and sizable net debt (TTM debt ~ $2.35B) limit financial flexibility, increase refinancing and covenant risk, and constrain capacity to absorb shocks. Even with improving EBITDA, capital structure remains a multi-quarter constraint on strategy execution.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong free cash flow generation
Persistent positive and improving free cash flow (TTM ~$380M) provides durable internal funding for capex, share repurchases, and deleveraging. Reliable cash conversion supports strategic initiatives and cushions the business against cyclical top-line swings and working-capital volatility.
Read all positive factors
Scotts Miracle-Gro Company Key Performance Indicators (KPIs)
Any
Revenue by Segment
Shows how much each business unit contributes to total revenue, offering insights into diversification and which segments drive growth.
Shows how much each business unit contributes to total revenue, offering insights into diversification and which segments drive growth.
Data provided by:
The Fly
The FlyScotts Miracle-Gro Company (SMG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.80B
Dividend Yield4.52%
Average Volume (3M)891.79K
Price to Earnings (P/E)34.6
Beta (1Y)0.64
Revenue Growth-1.89%
EPS Growth216.52%
CountryUS
Employees5,300
SectorBasic Materials
Sector Strength58
IndustryAgricultural Inputs
Share Statistics
EPS (TTM)1.90
Shares Outstanding58,181,940
10 Day Avg. Volume843,170
30 Day Avg. Volume891,786
Financial Highlights & Ratios
PEG Ratio-0.04
Price to Book (P/B)-9.18
Price to Sales (P/S)0.96
P/FCF Ratio11.98
Enterprise Value/Market Cap1.58
Enterprise Value/Revenue1.77
Enterprise Value/Gross Profit5.44
Enterprise Value/Ebitda11.88
Forecast
1Y Price Target
$64.51Price Target Upside-2.32% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)4.35
Revenue Forecast (FY)$3.33B
Scotts Miracle-Gro Company Business Overview & Revenue Model
Company Description
The Scotts Miracle-Gro Company (SMG) stands as a leading producer and global distributor of products dedicated to lawn and garden upkeep, as well as specialized indoor and hydroponic cultivation. The company's operations are strategically divided ...
How the Company Makes Money
SMG makes money primarily by selling branded lawn and garden consumables and related products to retailers and distributors, which then sell to end consumers. Its largest revenue stream comes from its U.S. Consumer segment, where revenue is genera...
Scotts Miracle-Gro Company Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial progress: revenue growth, meaningful gross margin expansion (200+ bps YTD), robust e-commerce acceleration (+22% YTD), improved EBITDA and net income, deleveraging to 3.71x, and material free cash flow improvement (> $100M YTD). Management announced strategic initiatives (SMG 2.0), portfolio innovation (83 new SKUs / $41M revenue), a disciplined SKU rationalization plan, AI/automation investments, and a multi-year share repurchase program. Key risks are manageable but notable: commodity cost volatility from geopolitical events creating fiscal '27 uncertainty, higher SG&A from marketing investments, an e-commerce margin gap, and near-term planning/line-review timing. Overall, positives materially outweigh the challenges, which management frames as controllable or hedged.Positive Updates
Revenue Growth
Total company net sales increased 5% in Q2 to $1.46 billion and increased 3% for the first 6 months to $1.81 billion, in line with full-year net sales guidance for low single-digit growth in U.S. consumer business.
Negative Updates
Commodity and Geopolitical Risk
Ongoing commodity cost exposure tied to the Iran war creates uncertainty for fiscal '27; management indicated many COGS positions are hedged for the current year but fiscal '27 remains a 'bigger unknown' and may require pricing actions.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue Growth
Total company net sales increased 5% in Q2 to $1.46 billion and increased 3% for the first 6 months to $1.81 billion, in line with full-year net sales guidance for low single-digit growth in U.S. consumer business.
Read all positive updates
Company Guidance
Scotts reaffirmed fiscal 2026 guidance while reporting Q2 net sales of $1.46B (+5%) and YTD net sales of $1.81B (+3%), with branded sales up 8%, POS dollars +4% YTD and e‑commerce POS +22% YTD; Q2 GAAP gross margin was 41.8% (+280 bps) and YTD GAAP gross margin 38.5% (+260 bps) (management says it can deliver on the ~32% full‑year gross margin guide and is targeting ~40% by 2030), adjusted EBITDA was $437.4M in Q2 ($440.2M YTD), leverage improved to 3.71x (‑0.7x YoY), YTD free cash flow was >$100M better than prior year, SG&A is trending to ~17–18% of sales, and the company will begin a multiyear share‑repurchase program (aiming to buy at least one‑third of shares) while maintaining leverage in the 3s; under SMG 2.0 management targets an incremental $1B in sales by 2030 (~$800M from e‑commerce), at least 1% annual supply‑chain savings (~$35M), will manage commodity exposure and may take pricing in fiscal ’27, and will provide a seasonal update in early June and an Investor Day deep dive on August 4.Scotts Miracle-Gro Company Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
24
Negative
Cash Flow
70
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.39B | 3.41B | 3.55B | 3.55B | 3.92B | 4.92B |
| Gross Profit | 1.10B | 1.04B | 850.50M | 657.30M | 872.90M | 1.47B |
| EBITDA | 504.40M | 425.50M | 215.80M | -182.70M | -334.80M | 849.80M |
| Net Income | 110.90M | 145.20M | -34.90M | -380.10M | -437.50M | 512.50M |
Balance Sheet | ||||||
| Total Assets | 3.41B | 2.74B | 2.87B | 3.41B | 4.30B | 4.80B |
| Cash, Cash Equivalents and Short-Term Investments | 6.20M | 36.60M | 71.60M | 31.90M | 86.80M | 244.10M |
| Total Debt | 2.35B | 2.38B | 2.52B | 2.91B | 3.27B | 2.60B |
| Total Liabilities | 3.70B | 3.10B | 3.26B | 3.68B | 4.15B | 3.79B |
| Stockholders Equity | -286.50M | -357.50M | -390.60M | -267.30M | 147.70M | 1.01B |
Cash Flow | ||||||
| Free Cash Flow | 379.70M | 273.90M | 583.50M | 438.20M | -242.50M | 164.60M |
| Operating Cash Flow | 478.10M | 371.30M | 667.50M | 531.00M | -129.00M | 271.50M |
| Investing Cash Flow | -122.80M | -112.10M | -100.40M | -65.70M | -283.20M | -538.60M |
| Financing Cash Flow | -363.70M | -294.00M | -527.90M | -520.10M | 255.30M | 494.00M |
Scotts Miracle-Gro Company Technical Analysis
Positive
66.04
Price Trends
61.66
Positive
62.97
Positive
59.92
Positive
Market Momentum
1.45
Positive
53.29
Neutral
19.81
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SMG, the sentiment is Positive. The current price of 66.04 is above the 20-day moving average (MA) of 65.71, above the 50-day MA of 61.66, and above the 200-day MA of 59.92, indicating a neutral trend. The MACD of 1.45 indicates Positive momentum. The RSI at 53.29 is Neutral, neither overbought nor oversold. The STOCH value of 19.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SMG.
Scotts Miracle-Gro Company Risk Analysis
Scotts Miracle-Gro Company disclosed 43 risk factors in its most recent earnings report. Scotts Miracle-Gro Company reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Scotts Miracle-Gro Company Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.23B | 10.09 | 40.08% | 12.33% | 19.00% | 61.11% | |
69 Neutral | $459.54M | 32.63 | 2.85% | ― | 9.55% | ― | |
66 Neutral | $3.80B | 34.62 | -33.72% | 4.52% | -1.89% | 216.52% | |
62 Neutral | $6.26B | 24.01 | 4.32% | 3.36% | 7.80% | -32.94% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
55 Neutral | $6.60B | 9.15 | 5.92% | 3.70% | 12.34% | -87.77% | |
46 Neutral | $1.37B | ― | -83.04% | 16.68% | -16.63% | -865.93% |
* Basic Materials Sector Average
SMG
Scotts Miracle-Gro Company
65.48
-0.84
-1.27%
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Scotts Miracle-Gro Company Corporate Events
Executive/Board Changes
Scotts Miracle-Gro Names Nathan Baxter New CEO
Neutral
Jul 1, 2026
On June 29, 2026, Scotts Miracle-Gro announced that Nathan E. Baxter has been appointed President and Chief Executive Officer, effective June 26, 2026, and has joined the Board of Directors. Baxter, previously President and Chief Operating Officer...
Business Operations and StrategyStock BuybackFinancial Disclosures
Scotts Miracle-Gro Posts Strong Q2 Results, Reaffirms Outlook
Positive
Apr 29, 2026
The Scotts Miracle-Gro Company, a leading North American marketer of branded consumer lawn and garden products under the Scotts, Miracle-Gro, Ortho and Tomcat brands, reported strong financial results for its second quarter ended March 28, 2026. T...
Business Operations and StrategyExecutive/Board ChangesFinancial DisclosuresM&A Transactions
ScottsMiracle-Gro Divests Hawthorne to Refocus on Core
Positive
Apr 9, 2026
On April 8, 2026, ScottsMiracle-Gro completed the sale of its Hawthorne Gardening Company subsidiary, which supplies nutrients, lighting and materials for indoor and hydroponic gardening in North America, to Vireo Growth in exchange for Vireo shar...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.