SCOTTS MIRACLE-GRO CO (SMG) Stock Fundamental Analysis
NYSE:SMG - New York Stock Exchange, Inc. - US8101861065 - Common Stock
Overall SMG gets a fundamental rating of 4 out of 10. We evaluated SMG against 85 industry peers in the Chemicals industry. While SMG is still in line with the averages on profitability rating, there are concerns on its financial health. SMG has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year SMG was profitable.
SMG had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: SMG reported negative net income in multiple years.
SMG had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
SMG has a worse Return On Assets (-1.22%) than 69.88% of its industry peers.
The Return On Invested Capital of SMG (13.23%) is better than 93.98% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SMG is above the industry average of 6.57%.
The last Return On Invested Capital (13.23%) for SMG is above the 3 year average (10.63%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.22% | ||
| ROE | N/A | ||
| ROIC | 13.23% |
ROA(3y)-7.51%
ROA(5y)-0.08%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)10.63%
ROIC(5y)13.54%
1.3 Margins
SMG has a Operating Margin of 10.00%. This is comparable to the rest of the industry: SMG outperforms 55.42% of its industry peers.
In the last couple of years the Operating Margin of SMG has declined.
SMG has a Gross Margin of 26.29%. This is comparable to the rest of the industry: SMG outperforms 48.19% of its industry peers.
In the last couple of years the Gross Margin of SMG has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10% | ||
| PM (TTM) | N/A | ||
| GM | 26.29% |
OM growth 3Y-13.17%
OM growth 5Y-5.28%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.65%
GM growth 5Y-4.15%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SMG is still creating some value.
The number of shares outstanding for SMG has been increased compared to 1 year ago.
Compared to 5 years ago, SMG has more shares outstanding
Compared to 1 year ago, SMG has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.63 indicates that SMG is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.63, SMG is doing good in the industry, outperforming 77.11% of the companies in the same industry.
The Debt to FCF ratio of SMG is 3.82, which is a good value as it means it would take SMG, 3.82 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 3.82, SMG is doing good in the industry, outperforming 79.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.82 | ||
| Altman-Z | 2.63 |
ROIC/WACC1.53
WACC8.62%
2.3 Liquidity
A Current Ratio of 1.31 indicates that SMG should not have too much problems paying its short term obligations.
SMG's Current ratio of 1.31 is on the low side compared to the rest of the industry. SMG is outperformed by 81.93% of its industry peers.
A Quick Ratio of 0.52 indicates that SMG may have some problems paying its short term obligations.
SMG has a worse Quick ratio (0.52) than 90.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 93.10% over the past year.
SMG shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -12.83% yearly.
Looking at the last year, SMG shows a small growth in Revenue. The Revenue has grown by 0.04% in the last year.
The Revenue has been growing slightly by 2.40% on average over the past years.
EPS 1Y (TTM)93.1%
EPS 3Y-37.53%
EPS 5Y-12.83%
EPS Q2Q%16.61%
Revenue 1Y (TTM)0.04%
Revenue growth 3Y-10.32%
Revenue growth 5Y2.4%
Sales Q2Q%10.73%
3.2 Future
Based on estimates for the next years, SMG will show a very strong growth in Earnings Per Share. The EPS will grow by 27.76% on average per year.
SMG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.80% yearly.
EPS Next Y45.51%
EPS Next 2Y36.36%
EPS Next 3Y29.06%
EPS Next 5Y27.76%
Revenue Next Year0.36%
Revenue Next 2Y1.43%
Revenue Next 3Y1.71%
Revenue Next 5Y2.8%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
SMG is valuated quite expensively with a Price/Earnings ratio of 31.73.
SMG's Price/Earnings ratio is a bit more expensive when compared to the industry. SMG is more expensive than 60.24% of the companies in the same industry.
SMG is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 21.80, SMG is valued on the expensive side.
The rest of the industry has a similar Price/Forward Earnings ratio as SMG.
The average S&P500 Price/Forward Earnings ratio is at 24.44. SMG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.73 | ||
| Fwd PE | 21.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SMG indicates a slightly more expensive valuation: SMG is more expensive than 60.24% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, SMG is valued cheaper than 92.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7 | ||
| EV/EBITDA | 14.2 |
4.3 Compensation for Growth
SMG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as SMG's earnings are expected to grow with 29.06% in the coming years.
PEG (NY)0.7
PEG (5Y)N/A
EPS Next 2Y36.36%
EPS Next 3Y29.06%
5. Dividend
5.1 Amount
SMG has a Yearly Dividend Yield of 3.73%. Purely for dividend investing, there may be better candidates out there.
SMG's Dividend Yield is rather good when compared to the industry average which is at 3.26. SMG pays more dividend than 83.13% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, SMG pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.73% |
5.2 History
The dividend of SMG has a limited annual growth rate of 3.51%.
SMG has paid a dividend for at least 10 years, which is a reliable track record.
SMG has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)3.51%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
The earnings of SMG are negative and hence is the payout ratio. SMG will probably not be able to sustain this dividend level.
The dividend of SMG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP-433.52%
EPS Next 2Y36.36%
EPS Next 3Y29.06%
SCOTTS MIRACLE-GRO CO
NYSE:SMG (1/21/2025, 8:04:00 PM)
After market: 71.07 0 (0%)71.07
+0.84 (+1.2%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners82.95%
Inst Owner Change-0.77%
Ins Owners0.57%
Ins Owner Change-0.22%
Market Cap4.08B
Analysts72.86
Price Target79.27 (11.54%)
Short Float %8.04%
Short Ratio4.26
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.73% |
Yearly Dividend2.66
Dividend Growth(5Y)3.51%
DP-433.52%
Div Incr Years0
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.98%
Min EPS beat(2)-16.32%
Max EPS beat(2)18.27%
EPS beat(4)3
Avg EPS beat(4)3.85%
Min EPS beat(4)-16.32%
Max EPS beat(4)18.27%
EPS beat(8)6
Avg EPS beat(8)4.46%
EPS beat(12)8
Avg EPS beat(12)2.66%
EPS beat(16)12
Avg EPS beat(16)12.71%
Revenue beat(2)1
Avg Revenue beat(2)1.03%
Min Revenue beat(2)-0.64%
Max Revenue beat(2)2.71%
Revenue beat(4)2
Avg Revenue beat(4)0.34%
Min Revenue beat(4)-1.57%
Max Revenue beat(4)2.71%
Revenue beat(8)4
Avg Revenue beat(8)0.81%
Revenue beat(12)4
Avg Revenue beat(12)-0.34%
Revenue beat(16)8
Avg Revenue beat(16)2.06%
PT rev (1m)-1.21%
PT rev (3m)0.41%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.76%
EPS NY rev (1m)0%
EPS NY rev (3m)-13.94%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.01%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)-1.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.73 | ||
| Fwd PE | 21.8 | ||
| P/S | 1.15 | ||
| P/FCF | 7 | ||
| P/OCF | 6.12 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.2 |
EPS(TTM)2.24
EY3.15%
EPS(NY)3.26
Fwd EY4.59%
FCF(TTM)10.16
FCFY14.29%
OCF(TTM)11.62
OCFY16.35%
SpS61.84
BVpS-6.8
TBVpS-18.33
PEG (NY)0.7
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.22% | ||
| ROE | N/A | ||
| ROCE | 16.74% | ||
| ROIC | 13.23% | ||
| ROICexc | 13.69% | ||
| ROICexgc | 20.23% | ||
| OM | 10% | ||
| PM (TTM) | N/A | ||
| GM | 26.29% | ||
| FCFM | 16.42% |
ROA(3y)-7.51%
ROA(5y)-0.08%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)10.63%
ROIC(5y)13.54%
ROICexc(3y)10.91%
ROICexc(5y)13.96%
ROICexgc(3y)15.3%
ROICexgc(5y)22.83%
ROCE(3y)13.46%
ROCE(5y)17.14%
ROICexcg growth 3Y-10.58%
ROICexcg growth 5Y-6.7%
ROICexc growth 3Y-7.68%
ROICexc growth 5Y0%
OM growth 3Y-13.17%
OM growth 5Y-5.28%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-4.65%
GM growth 5Y-4.15%
F-Score6
Asset Turnover1.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.82 | ||
| Debt/EBITDA | 4.99 | ||
| Cap/Depr | 104.22% | ||
| Cap/Sales | 2.36% | ||
| Interest Coverage | 2.25 | ||
| Cash Conversion | 153.17% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.31 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z | 2.63 |
F-Score6
WACC8.62%
ROIC/WACC1.53
Cap/Depr(3y)104.14%
Cap/Depr(5y)98.52%
Cap/Sales(3y)2.62%
Cap/Sales(5y)2.31%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)93.1%
EPS 3Y-37.53%
EPS 5Y-12.83%
EPS Q2Q%16.61%
EPS Next Y45.51%
EPS Next 2Y36.36%
EPS Next 3Y29.06%
EPS Next 5Y27.76%
Revenue 1Y (TTM)0.04%
Revenue growth 3Y-10.32%
Revenue growth 5Y2.4%
Sales Q2Q%10.73%
Revenue Next Year0.36%
Revenue Next 2Y1.43%
Revenue Next 3Y1.71%
Revenue Next 5Y2.8%
EBIT growth 1Y21.77%
EBIT growth 3Y-22.13%
EBIT growth 5Y-3.01%
EBIT Next Year59.49%
EBIT Next 3Y23.92%
EBIT Next 5Y20.01%
FCF growth 1Y33.16%
FCF growth 3Y52.48%
FCF growth 5Y25.91%
OCF growth 1Y25.71%
OCF growth 3Y34.97%
OCF growth 5Y24.1%