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Scotts Miracle-Gro (SMG) Q4 Earnings & Sales Beat Estimates

The Scotts Miracle-Gro Company SMG reported a fourth-quarter fiscal 2023 (ended Sep 30, 2023) loss of $468.4 million or $8.33 per share compared with a loss of $220.1 million or $3.97 per share in the year-ago quarter.

Barring one-time items, the adjusted loss was $2.77 per share, wider than a loss of $2.04 a year ago. The figure was narrower than the Zacks Consensus Estimate of a loss of $2.83.

Net sales fell around 24.1% year over year to $374.5 million but surpassed the consensus mark of $331.2 million. The decline in sales was due to lower sales in the U.S. Consumer and Hawthorne segments.

The Scotts Miracle-Gro Company Price, Consensus and EPS Surprise

The Scotts Miracle-Gro Company price-consensus-eps-surprise-chart | The Scotts Miracle-Gro Company Quote

Segment Details

In the fiscal fourth quarter, net sales in the U.S. Consumer division were down 33% year over year to $201 million. It was higher than our estimate of $173 million.

Net sales in the Hawthorne segment tumbled 11% year over year to $149.7 million in the reported quarter. The figure was higher than our estimate of $149 million.

Net sales in the other segment increased 3% year over year to $23.8 million.

Balance Sheet

At the end of fiscal 2023, the company had cash and cash equivalents of $31.9 million, down from $86.8 million in fiscal 2022. Long-term debt was $2,557.4 million, down from $2,826.2 million in fiscal 2022.

FY2024 Outlook

The company noted that its outlook for fiscal 2024 incorporates significant progress on margin recovery while adjusting for a higher share count, effective tax rate and average cost of borrowing compared with fiscal 2023.

It has developed an aggressive operating plan for fiscal 2024 that is built upon strong engagement with retailer partners and sustained diligence with cost management, free cash flow generation and debt repayment.

Price Performance

Shares of Scotts Miracle-Gro have gained 14.1% in the past year against a 37.4% decline of the industry.

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Zacks Investment Research


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Zacks Rank & Other Key Picks

Scotts Miracle-Gro currently carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the basic materials space include Equinox Gold Corp. EQX, Koppers Holdings Inc. KOP and The Andersons Inc. ANDE.

Equinox has a projected earnings growth rate of 90% for the current year. It currently carries a Zacks Rank #2.  Equinox delivered a trailing four-quarter earnings surprise of roughly 18.1%, on average. The stock is up around 54.1% in a year. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Koppers has a projected earnings growth rate of 7.5% for the current year. It currently carries a Zacks Rank #2.  Koppers delivered a trailing four-quarter earnings surprise of roughly 21.7%, on average. The stock is up around 52.8% in a year.

Andersons currently carries a Zacks Rank #1. The stock has gained roughly 38.9% in the past year. ANDE beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4%, on average.

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