Scotts Miracle Gro (SMG) Could Be 26% Undervalued After Leadership Change
Scotts Miracle-Gro (SMG) moved into focus after the company disclosed that Executive Vice President and Chief Strategy Officer Christopher J. Hagedorn will leave his role on September 30, 2026, following an agreement reached on August 29.
Recent trading has been softer, with Scotts Miracle-Gro’s share price falling 9.46% over the past 30 days and 5.5% year to date. The 1-year total shareholder return is down 4.89%, but this is still ahead of the much weaker 5-year total shareholder return, which has declined 52.36%.
Compare Scotts Miracle-Gro’s recent share price pressure with other hand-picked materials and consumer stocks by scanning our 33 high quality undervalued stocks for potential ideas with stronger value appeal.
Scotts Miracle-Gro still runs a sizeable lawn and garden franchise, yet the share price has been under pressure after the leadership news. Is the current valuation treating it as a solid business or a value trap?
Most Popular Narrative: 25.6% Undervalued
On the most followed narrative, Scotts Miracle-Gro screens as undervalued, with a fair value of $75.50 against a last close of $56.16, setting up a wide valuation gap for investors to weigh.
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. These initiatives are described as directly driving gross margin recovery (aiming for 35%+), boosting EBITDA, and improving long-term net margins.
Curious what has to happen in Scotts Miracle-Gro’s income statement for that valuation to make sense. The narrative leans on steady revenue progress, rising profitability, and a lower earnings multiple than many chemical peers to bridge the gap between today’s share price and its fair value estimate.
Result: Fair Value of $75.50 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
Still, that story can break if environmental rules and consumer shifts toward organic options squeeze Scotts Miracle-Gro’s traditional products, or if weather swings keep sales unpredictable.
Find out about the key risks to this Scotts Miracle-Gro narrative.
Another View on Scotts Miracle-Gro’s Valuation
The earlier narrative leans on discounted cash flows and analyst targets that frame Scotts Miracle-Gro as 25.6% undervalued, yet the plain P/E picture looks less generous. The shares trade on 21.1x earnings while peers average 19.2x and the fair ratio is 20.4x. This points to a modest valuation premium rather than a clear discount. Is the DCF story capturing something the simpler earnings multiple is missing, or is it asking you to accept more execution risk than you are comfortable with?
See what the numbers say about this price — find out in our valuation breakdown.
Next Steps
Mixed messages around Scotts Miracle-Gro’s valuation and leadership can easily pull you in different directions, so move fast, review the underlying data, and decide what feels right using our breakdown of 4 key rewards and 3 important warning signs.
Looking for more investment ideas beyond Scotts Miracle-Gro?
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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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