Scotts Miracle-Gro Company (The) (SMG) Company Bio
Scotts Miracle-Gro Company manufactures, markets, and sells consumer lawn and garden care products worldwide. The company was founded in 1868 and is in Marysville, Ohio.
SMG Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Scotts Miracle-Gro Co. To summarize, we found that Scotts Miracle-Gro Co ranked in the 40th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 28%. The most interesting components of our discounted cash flow analysis for Scotts Miracle-Gro Co ended up being:
The company's balance sheet shows it gets 85% of its capital from equity, and 15% of its capital from debt. Notably, its equity weight is greater than 71.33% of US equities in the Basic Materials sector yielding a positive free cash flow.
Scotts Miracle-Gro Co's effective tax rate, as measured by taxes paid relative to net income, is at 17 -- greater than 66.34% of US stocks with positive free cash flow.
Scotts Miracle-Gro Co's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 6.07. This coverage rate is greater than that of 65.7% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
GGB, USAP, USLM, NP, and TSE can be thought of as valuation peers to SMG, in the sense that they are in the Basic Materials sector and have a similar price forecast based on DCF valuation.
Dividend Increases are the foundation of our plan to achieve financial freedom. We are looking to build a growing, passive income stream using dividends! The key word in the previous sentence is growing. That is why the two of us are always monitoring our companies to see if they announce...
Dividend Diplomats on Seeking Alpha | August 7, 2020
From the companies we’ve been following, there are few that have benefitted from COVID-19 like Scotts Miracle-Gro (SMG) has done. A strong Q3 has caused management to update their outlook, with company-wide sales growth now expected to be in the range of 26% to 28% from their previous target of...