Scotts Miracle-Gro Co (SMG) stock analysis

P/E against its history

Not enough price and earnings history to compare.

P/E above the industry

Scotts Miracle-Gro's P/E of 52.7 is above the Chemicals and Allied Products median of 25.0.

EV/EBITDA below its 5-year median

Scotts Miracle-Gro's EV/EBITDA of 15.2 is below its 5-year median of 15.8.

P/S below the industry

Scotts Miracle-Gro's price-to-sales of 1.07 is below the Chemicals and Allied Products median of 3.27 (book value is negative, so we use sales).

Trading above fair value

The share price of $63.74 is above our fair value estimate of $51.60.

Margin of safety under 20%

The price is 23.5% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -4.5% a year over the last three fiscal years, short of the 10% we look for.

EPS growth over 3 years

Needs positive EPS three years ago and today.

Earnings acceleration

Needs positive net income now, a year ago and five years ago.

Growing faster than the industry

Revenue grew 4.6% over the last twelve months; the Chemicals and Allied Products median is 4.6%.

Guidance raised

Scotts Miracle-Gro raised its Full-Year Fiscal 2026 non-GAAP adjusted diluted net income per share from continuing operations outlook on Jul 29, 2026.

Gross margin improving

Gross margin was 31.8% over the last twelve months, against 29.2% a year earlier.

Return on equity

Needs positive equity and five years of results.

Return on capital over 10%

Return on invested capital was 12.3%, above the 10% that usually covers the cost of capital.

Return on equity against the industry

Needs positive equity.

Earnings shrank over 5 years

Net income shrank 17.8% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 2.1% over the last twelve months, against a 5-year average of -1.6%.

Net margin above the industry

Scotts Miracle-Gro's net margin of 2.1% is above the Chemicals and Allied Products median of -9.4%.

Debt level

Needs debt and equity figures.

Debt trend

Needs a balance sheet from five years ago with positive equity.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 17.5% of total debt; we look for at least 20%.

Interest not well covered

Operating income covers interest expense 3.4 times; we look for at least 5.

Short-term assets cover short-term debts

Current assets are 1.21 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.43; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Scotts Miracle-Gro paid dividends worth 4.1% of the share price over the last twelve months.

Yield below Treasuries

The 4.1% yield is below the 4.6% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.9% or more; Scotts Miracle-Gro yields 4.1%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Not covered by earnings

Dividends take 209% of net income, leaving little room.

Covered by free cash flow

Dividends take 58.6% of free cash flow.