The Scotts Miracle-Gro Company SMG reported a third-quarter fiscal 2024 (ended Jun 29, 2024) profit of $132.1 million or $2.28 per share compared with a profit of $43.7 million or 77 cents per share in the year-ago quarter.
Barring one-time items, the adjusted earnings were $2.31 per share, up from $1.17 a year ago. The figure surpassed the Zacks Consensus Estimate of $1.89.
Net sales increased around 7.5% year over year to $1,202.2 million but missed the consensus mark of $1,203.6 million.
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 third quarter, net sales in the U.S. Consumer division were up 11% year over year to $1,017.5 million. It was lower than our estimate of $1,083.2 million. The segment delivered a profit of $210.3 million, up 69% year over year.
Net sales in the Hawthorne segment tumbled 28% year over year to $67.7 million in the reported quarter. The figure was lower than our estimate of $94.7 million. The segment reported a profit of $3.8 million, up 144% year over year.
Net sales in the other segment increased 7% year over year to $117 million. The segment reported a profit of $11.7 million, up 102%.
Balance Sheet
At the end of the quarter, the company had cash and cash equivalents of $279.9 million, up from $27.4 million a year ago. Long-term debt was $2,436.4 million, down around 7.3%.
Outlook
SMG reiterated its adjusted fiscal 2024 guidance issued in June, with the exception of Hawthorne net sales, which are now expected to be 35-40% lower than the previous year due to progress exiting lower margin distributed brands and a projected decline in its professional horticulture lighting business. The segment continues to anticipate break-even or improved adjusted EBITDA for the full year.
Price Performance
Shares of Scotts Miracle-Gro have gained 35.9% in the past year against a 25.2% decline of the industry.
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Zacks Rank & Key Picks
SMG currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks worth a look in the basic materials space include Barrick Gold Corporation GOLD, Hecla Mining Company HL and SilverCrest Metals Inc. SILV.
Barrick is slated to report second-quarter results on Aug 12, before market open. The Zacks Consensus Estimate for GOLD’s second-quarter earnings is pegged at 26 cents. It beat the consensus in the last four quarters, with the average earnings surprise being 18.3%. GOLD currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hecla, carrying a Zacks Rank #1, is slated to report second-quarter results on Aug 6. The Zacks Consensus Estimate for Hecla's second-quarter earnings is pegged at a penny per share. The stock has gained nearly 9% in the past year.
SilverCrest will report results for the second quarter on Aug 7. The Zacks Consensus Estimate for its second-year earnings is pegged at 17 cents. SILV, a Zacks Rank #2 stock, beat the consensus in the last four quarters, with the average earnings surprise being 42.4%. The stock has surged nearly 120.3% in the past year.
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