Scotts Miracle-Gro Beats on EPS but GAAP Results Lag
Scotts Miracle-Gro (NYS: SMG) reported earnings on May 8. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended March 31 (Q2), Scotts Miracle-Gro missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share contracted significantly.
Margins shrank across the board.
Scotts Miracle-Gro reported revenue of $1.17 billion. The 10 analysts polled by S&P Capital IQ expected revenue of $1.20 billion on the same basis. GAAP reported sales were 3.9% higher than the prior-year quarter's $1.13 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $2.15. The 12 earnings estimates compiled by S&P Capital IQ forecast $2.06 per share. GAAP EPS of $2.05 for Q2 were 22% lower than the prior-year quarter's $2.63 per share. (The prior-year quarter included $0.43 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 39.4%, 160 basis points worse than the prior-year quarter. Operating margin was 18.6%, 310 basis points worse than the prior-year quarter. Net margin was 10.8%, 490 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.19 billion. On the bottom line, the average EPS estimate is $2.33.
Next year's average estimate for revenue is $3.06 billion. The average EPS estimate is $2.87.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 221 members out of 251 rating the stock outperform, and 30 members rating it underperform. Among 89 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 83 give Scotts Miracle-Gro a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Scotts Miracle-Gro is hold, with an average price target of $49.20.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Scotts Miracle-Gro. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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