The Scotts Miracle-Gro Company Just Reported A Surprise Loss: Here's What Analysts Think Will Happen Next

It's been a sad week for The Scotts Miracle-Gro Company (NYSE:SMG), who've watched their investment drop 19% to US$72.60 in the week since the company reported its yearly result. Revenues came in at US$3.6b, in line with estimates, while Scotts Miracle-Gro reported a statutory loss of US$0.61 per share, well short of prior analyst forecasts for a profit. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Scotts Miracle-Gro

Following last week's earnings report, Scotts Miracle-Gro's eight analysts are forecasting 2025 revenues to be US$3.56b, approximately in line with the last 12 months. Scotts Miracle-Gro is also expected to turn profitable, with statutory earnings of US$3.27 per share. In the lead-up to this report, the analysts had been modelling revenues of US$3.62b and earnings per share (EPS) of US$3.87 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

It might be a surprise to learn that the consensus price target fell 8.0% to US$81.71, with the analysts clearly linking lower forecast earnings to the performance of the stock price. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Scotts Miracle-Gro analyst has a price target of US$100.00 per share, while the most pessimistic values it at US$70.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. From these estimates it looks as though the analysts expect the years of declining revenue to come to an end, given the flat forecast out to 2025. That would be a definite improvement, given that the past five years have seen revenue shrink 1.8% annually. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 4.6% per year. So it's pretty clear that, although revenues are improving, Scotts Miracle-Gro is still expected to grow slower than the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Scotts Miracle-Gro's future valuation.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Scotts Miracle-Gro going out to 2027, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 2 warning signs for Scotts Miracle-Gro you should be aware of, and 1 of them is potentially serious.

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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.