Scotts Miracle Gro (SMG) Faces A Valuation Test Following New Growth Guidance

Scotts Miracle-Gro (SMG) has outlined earnings guidance for fiscal 2027 through 2029 that points to expected total company net sales growth of 2% to 4%, paired with a renewed focus on disciplined tuck in acquisitions.

See our latest analysis for Scotts Miracle-Gro.

Against the backdrop of this guidance and acquisition plan, Scotts Miracle-Gro shares trade at US$59.55, with a 30 day share price return that declined 16.1% and a 1 year total shareholder return close to flat. This follows a stronger 3 year total shareholder return of 34.86% and a 5 year total shareholder return that declined 54.61%, which points to long term momentum still rebuilding.

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Scotts Miracle-Gro shares have pulled back while analyst targets and intrinsic estimates sit higher, which creates a wide spread in implied fair value. How far does that gap run once you line up the valuation work?

Most Popular Narrative: 21.1% Undervalued

Scotts Miracle-Gro's most followed valuation narrative places fair value at $75.50 compared with the recent $59.55 share price, which frames the current discount as meaningful and rooted in detailed earnings and margin assumptions.

Significant ongoing investments in supply chain technology, automation, and process efficiencies are unlocking ~$75 million in cost savings for fiscal '25 and another ~$75 million planned for '26/'27, directly driving gross margin recovery (aiming for 35%+), boosting EBITDA, and improving long-term net margins.

Read the complete narrative.

Want to see what sits behind that margin rebuild story? The narrative leans heavily on a specific profit trajectory, revenue shape and the earnings multiple that ties it all together.

Result: Fair Value of $75.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, investors still need to factor in tighter environmental rules and any reset from key retailers, since either could pressure Scotts Miracle-Gro's revenue mix and margins.

Find out about the key risks to this Scotts Miracle-Gro narrative.

Another View on Scotts Miracle-Gro Valuation

While the popular Scotts Miracle-Gro narrative leans on a discounted cash flow fair value of $75.50, the market is also looking at plain P/E maths. The stock trades on 22.4x earnings, which is higher than peer averages at 17.6x and above a fair ratio of 19.8x.

That gap suggests some valuation risk if expectations shift or earnings progress slows. The P/E is still below the wider US Chemicals industry at 26.8x though, so the question for you is which anchor matters more right now: peers, the industry, or that fair ratio.

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

With sentiment split between cautious and optimistic on Scotts Miracle-Gro, it makes sense to move quickly and test the numbers for yourself. To weigh those concerns against the potential upside, start with the company’s 4 key rewards and 3 important warning signs

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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