Key insights
- Scotts Miracle-Gro reaffirmed its fiscal 2026 guidance, projecting low single-digit net sales growth and specific EPS and EBITDA targets. The company noted positive consumer trends and secured commodity pricing for the upcoming fiscal year. While the company's guidance is in line with expectations, it does not present a significant leading indicator for broader US equity market movements.
MARYSVILLE, Ohio - The Scotts Miracle-Gro Company (NYSE:SMG) reaffirmed its full fiscal year 2026 guidance today ahead of its fiscal third quarter close on June 27, according to a press release statement.
The company reported that year-to-date branded consumer point-of-sale dollars are up approximately 1 percent compared to the same period last year as of early June. The company stated that about 90 percent of its commodities are locked for fiscal 2026.
The reaffirmed fiscal 2026 guidance includes U.S. Consumer net sales low single-digit growth, non-GAAP adjusted gross margin of at least 32 percent, and non-GAAP adjusted net income per share from continuing operations of $4.15 to $4.35. The company also projects non-GAAP adjusted EBITDA mid single-digit growth and free cash flow of approximately $275 million. The company’s gross margin over the last twelve months stands at 32.49%, aligning closely with management’s targets, while its free cash flow yield of 12% suggests strong cash generation relative to its $3.28 billion market capitalization. According to InvestingPro analysis, the stock currently trades below its Fair Value, placing it among opportunities on the most undervalued stocks list.
"With the peak lawn and garden season upon us, we continue to see positive trends on a number of fronts, from consistent retailer engagement to steady consumer takeaway," said Jim Hagedorn, chairman and CEO.
Nate Baxter, president and chief operating officer, noted that the company has seen gains in point-of-sale and retailer replenishment since Memorial Day.
Mark Scheiwer, chief financial officer and chief accounting officer, said achieving the adjusted EBITDA and free cash flow targets will enable the company to maintain its leverage ratio in the high 3s and begin executing its share repurchase program by the end of the calendar year. InvestingPro Tips highlight the company’s high shareholder yield and its track record of maintaining dividend payments for 22 consecutive years, with a current dividend yield of 4.68%. For investors seeking deeper insights, InvestingPro offers access to over 10 additional exclusive tips for SMG.
The company announced today at the William Blair Annual Growth Stock Conference in Chicago. The company will host its 2026 Investor Day at the New York Stock Exchange on August 4, 2026.
The Scotts Miracle-Gro Company markets branded consumer lawn and garden products in North America, with approximately $3.3 billion in sales.
In other recent news, Scotts Miracle-Gro Company reported impressive second-quarter 2026 earnings, exceeding both earnings per share (EPS) and revenue projections. The company achieved an EPS of $4.53, surpassing the forecasted $3.86, marking a 17.36% positive surprise. Additionally, Scotts Miracle-Gro’s revenue reached $1.46 billion, beating the anticipated $1.41 billion, resulting in a 3.55% surprise. In the realm of analyst evaluations, UBS adjusted its price target for Scotts Miracle-Gro to $63 from $70, maintaining a Neutral rating due to cost pressures. The firm also revised its fiscal 2026 EPS estimate to $4.21, slightly below consensus. Stifel, on the other hand, reduced its price target to $76 from $79 while maintaining a Buy rating, citing valuation concerns but noting an increase in earnings estimates. Jefferies also decreased its price target to $79 from $82, keeping a Buy rating on the stock. These adjustments reflect varying perspectives on the company’s financial outlook amidst recent developments.
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