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What: Shares of lawn and garden specialist Scotts Miracle-Gro (NYS: SMG) were wilting today, falling as much as 11% in intraday trading after the company reduced its outlook for the full year.
So what: When it comes to earnings disappointments, weather is far from an unheard of excuse. In some cases, it makes a lot of sense. In others, not so much. For a company like Scotts that focuses on landscaping products, weather is a pretty big deal -- if homeowners are getting washed out by storms or frozen over by cold temperatures, it's going to have a definite impact on the company's bottom line.
In its press release today, Scotts placed the blame on Hurricane Irene and "other inclement weather in September" for the reduction in expected full-year earnings. The company now sees its fiscal 2011 (which ended in September) earnings per share coming in at $2.70 to $2.75 versus a previous forecast of $2.95 to $3.05.
Now what: There's not a whole lot that Scotts can do about adverse weather except keep its business strong enough generally to be able to weather (OK, pun intended) the occasional profit disappointment. While investors initially reacted sharply to Scotts' announcement, the stock's loss has moderated through the day, suggesting that they may be giving the company at least a partial pass for the weather issues.
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