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Scotts Miracle-Gro (SMG) to Post Q2 Earnings: What's in Store?

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The Scotts Miracle-Gro Company (SMG - Free Report) is set to release second-quarter fiscal 2021 results on May 5, before the opening bell.

The company has a trailing four-quarter earnings surprise of 40.78%, on average. Its fiscal second-quarter performance is likely to reflect benefits of higher demand from U.S. Consumer and Hawthorne businesses.

Shares of ScottsMiracle-Gro have gained 82.6% in the past year compared with 92.8% rise of the industry.

Let’s see how things are shaping up for this announcement.

Zacks Model

Our proven model predicts an earnings beat for ScottsMiracle-Gro this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: Earnings ESP for ScottsMiracle-Gro is +0.73%. The Zacks Consensus Estimate is currently pegged at $5.51. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: ScottsMiracle-Gro currently carries a Zacks Rank #3.

What do the Estimates Indicate?

The Zacks Consensus Estimate for fiscal second-quarter revenues is currently pegged at $1,739 million, which calls for a 25.7% rise year over year.

Factors at Play

The company is likely to have gained from higher demand in both its U.S. Consumer and Hawthorne units in the quarter to be reported.

The company is expected to have benefited from strong retailer support in the U.S. Consumer segment and continued momentum in the Hawthorne segment. The company, earlier this year, stated that consumer purchases of its products at its largest retailers were up 25% year-to-date entering March. Strong shipments are likely to have supported performance in the U.S. Consumer unit.

In Hawthorne, second-quarter performance is likely to have benefited from strong growth across the product categories, especially hydroponic lighting in North America.

However, the company is expected to have been impacted by high marketing expenses in the quarter. High commodity costs might also have put pressure on margins.

The Scotts MiracleGro Company Price and EPS Surprise

 

The Scotts MiracleGro Company Price and EPS Surprise

The Scotts MiracleGro Company price-eps-surprise | The Scotts MiracleGro Company Quote

 

Other Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows that they too have the right combination of elements to post an earnings beat this quarter:

CF Industries Holdings, Inc. (CF - Free Report) , scheduled to release earnings on May 5, has an Earnings ESP of +4.53% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Koppers Holdings, Inc. (KOP - Free Report) , scheduled to release earnings on May 7, has an Earnings ESP of +5.26% and a Zacks Rank #2.

Westlake Chemical Company (WLK - Free Report) , scheduled to release earnings on May 4, has an Earnings ESP of +0.64% and carries a Zacks Rank #3.

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