Scotts Miracle-Gro (NYSE:SMG) Announces Quarterly Earnings Results, Beats Expectations By $0.34 EPS

Key Points

• Scotts Miracle-Gro beat earnings expectations: Quarterly EPS was $2.82, surpassing the $2.48 consensus, while revenue reached $1.17 billion and increased 1.1% year over year.
• Fiscal 2026 outlook improved: The company reaffirmed its outlook and raised adjusted EPS guidance to $4.30–$4.45 from $4.15–$4.35. Year-to-date adjusted EBITDA rose 5% to $686.6 million, helping reduce leverage to 3.78x.
• Retail inventory remains a concern: Elevated retailer inventories and weaker early-May weather could slow fourth-quarter purchasing and push U.S. consumer sales growth toward the low end of guidance, despite growth in branded products and e-commerce.

Scotts Miracle-Gro (NYSE:SMG - Get Free Report) announced its quarterly earnings results on Wednesday. The basic materials company reported $2.82 earnings per share for the quarter, topping analysts' consensus estimates of $2.48 by $0.34, FiscalAI reports. Scotts Miracle-Gro had a negative return on equity of 79.61% and a net margin of 3.27%.The firm had revenue of $1.17 billion for the quarter, compared to the consensus estimate of $1.17 billion. During the same quarter in the previous year, the business earned $2.59 earnings per share. The business's revenue was up 1.1% compared to the same quarter last year.

Here are the key takeaways from Scotts Miracle-Gro's conference call:

• Positive Sentiment: Scotts Miracle-Gro reaffirmed its fiscal 2026 outlook and raised adjusted EPS guidance to $4.30–$4.45, up from $4.15–$4.35.
• Positive Sentiment: Year-to-date adjusted EBITDA increased 5% to $686.6 million, while leverage improved to 3.78x from 4.15x a year ago as strong free cash flow supported debt reduction.
• Positive Sentiment: The company is shifting toward higher-margin branded products, with branded sales up 4.5%, e-commerce POS up 27%, and recent innovation generating $278 million in gross sales over the last three years.
• Negative Sentiment: Retailer inventories were elevated by high-single-digit percentages after early-May weather softness, and management expects fourth-quarter purchasing activity to slow, likely pushing U.S. consumer sales growth to the low end of its guidance.
• Neutral Sentiment: Management is reassessing capital allocation and may pursue its $1 billion sales and EBITDA targets beyond 2030, prioritizing consistent quality earnings growth, margin expansion, leverage below 3.5x, reinvestment, dividends, and a measured share-repurchase program.

Scotts Miracle-Gro Price Performance

SMG stock traded down $3.17 on Wednesday, reaching $69.93. 616,072 shares of the company traded hands, compared to its average volume of 937,818. The company has a market cap of $4.07 billion, a P/E ratio of 39.04 and a beta of 1.81. Scotts Miracle-Gro has a one year low of $52.00 and a one year high of $75.34. The firm has a fifty day simple moving average of $64.28 and a 200-day simple moving average of $64.15.

Scotts Miracle-Gro Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Friday, September 4th. Shareholders of record on Friday, August 21st will be paid a dividend of $0.66 per share. The ex-dividend date of this dividend is Friday, August 21st. This represents a $2.64 dividend on an annualized basis and a dividend yield of 3.8%. Scotts Miracle-Gro's dividend payout ratio (DPR) is currently 147.49%.

Hedge Funds Weigh In On Scotts Miracle-Gro

Several large investors have recently added to or reduced their stakes in SMG. Invesco Ltd. lifted its position in Scotts Miracle-Gro by 25.6% during the fourth quarter. Invesco Ltd. now owns 254,087 shares of the basic materials company's stock valued at $14,826,000 after purchasing an additional 51,738 shares during the last quarter. Corient Private Wealth LLC boosted its stake in shares of Scotts Miracle-Gro by 50.5% during the fourth quarter. Corient Private Wealth LLC now owns 129,847 shares of the basic materials company's stock valued at $7,505,000 after purchasing an additional 43,571 shares in the last quarter. Quadrature Capital Ltd bought a new position in shares of Scotts Miracle-Gro in the 4th quarter worth $286,000. Man Group plc grew its position in shares of Scotts Miracle-Gro by 1.8% in the 4th quarter. Man Group plc now owns 44,389 shares of the basic materials company's stock worth $2,590,000 after buying an additional 806 shares during the last quarter. Finally, Balyasny Asset Management L.P. lifted its holdings in shares of Scotts Miracle-Gro by 39.1% during the 4th quarter. Balyasny Asset Management L.P. now owns 613,693 shares of the basic materials company's stock valued at $35,809,000 after purchasing an additional 172,356 shares during the last quarter. Hedge funds and other institutional investors own 74.07% of the company's stock.

Analysts Set New Price Targets

SMG has been the topic of several recent analyst reports. Jefferies Financial Group reissued a "buy" rating and issued a $79.00 target price on shares of Scotts Miracle-Gro in a report on Wednesday, April 29th. Wall Street Zen raised Scotts Miracle-Gro from a "hold" rating to a "buy" rating in a research note on Saturday, July 4th. Weiss Ratings reissued a "hold (c)" rating on shares of Scotts Miracle-Gro in a research note on Monday, May 4th. Wells Fargo & Company increased their target price on shares of Scotts Miracle-Gro from $72.00 to $74.00 and gave the stock an "overweight" rating in a research note on Wednesday, July 8th. Finally, UBS Group increased their target price on Scotts Miracle-Gro from $63.00 to $70.00 and gave the stock a "neutral" rating in a report on Thursday, July 16th. Three analysts have rated the stock with a Buy rating and four have assigned a Hold rating to the company. Based on data from MarketBeat.com, Scotts Miracle-Gro presently has a consensus rating of "Hold" and an average target price of $73.00.

Scotts Miracle-Gro Company Profile

Scotts Miracle-Gro Company is a leading developer, manufacturer and distributor of consumer lawn and garden products. The firm serves both retail and professional customers through an array of branded offerings that include lawn fertilizers, grass seed, pest and disease control solutions, plant foods and specialty products for indoor and outdoor gardening. Its portfolio spans well-known names such as Scotts®, Miracle-Gro®, Ortho® and various hydroponic and specialty garden brands.

Headquartered in Marysville, Ohio, the company traces its roots to O.M.

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