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SMG to Expand Soil Amendment Portfolio With Black Kow Acquisition
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Key Takeaways
SMG plans to acquire Black Kow, adding organic amendments, mature manure and specialty soils.
SMG aims to scale Black Kow nationwide through innovation and increased household penetration.
Fiscal 2027-2029 targets include 2-4% sales growth, 5-8% EPS growth, and free cash flow above $275M.
The Scotts Miracle-Gro Company (SMG - Free Report) is expanding its media and soil amendment portfolio as part of its multi-year SMG 2.0 growth plan by acquiring the Black Kow brand. The planned acquisition is built on SMG’s existing agreement, under which the company has been the exclusive producer, distributor and marketer of Black Kow since January 2026, with an option to buy. The company has announced its intention to exercise the option, with an expected close in October. Terms of the deal have not been disclosed.
The acquisition helps the company progress with its multi-year SMG 2.0 growth plan that is focused on achieving mid-range financial targets. Black Kow’s acquisition will aid innovation through revitalization of product lineups to drive premium growth by integrating it seamlessly into SMG’s core lawn and garden business. The portfolio will now additionally include organic amendments, mature manure and specialty soils.
Management expects the transaction to contribute to topline sales while maintaining the margin profile established by the company. The acquisition also underscores SMG’s disciplined capital allocation approach, with management describing it as a low-risk investment that is expected to support leverage ratio targets and be accretive to earnings per share beginning in the first year.
SMG plans to scale the Black Kow brand, a trusted 57-year-old name in the soil amendment category, through innovation and expand its availability nationwide by increasing household penetration. The deal also supports the company’s fiscal 2027-2029 growth algorithm, which targets 2-4% annual net sales growth, 50-100 basis points of adjusted gross margin improvement, 5-8% adjusted EPS growth, and free cash flow above $275 million.
SMG shares have lost 4.5% in the past year against the industry’s 11.5% growth.
Image Source: Zacks Investment Research
SMG’s Zacks Rank & Key Picks
SMG currently carries a Zacks Rank #3 (Hold)
Some better-ranked stocks in the Basic Materials space are Neo Performance Materials Inc. (NOPMF - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and Avient Corporation (AVNT - Free Report) .
The Zacks Consensus Estimate for NOPMF’s 2026 earnings is pegged at $1.4 per share, indicating a 185.71% year-over-year increase. NOPMF’sshares have gained 84.1% over the past year.
The Zacks Consensus Estimate for CRS’ fiscal 2027 earnings is pegged at $12.92 per share, indicating a rise of 20.07% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 8.39%.
The Zacks Consensus Estimate for AVNT’s current-year earnings is pinned at $3.2 per share, indicating a 13.48% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 3.4%. AVNT’sshares have gained 14.6% over the past year.
View the Zacks #1 Rank List
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SMG to Expand Soil Amendment Portfolio With Black Kow Acquisition
Key Takeaways
The Scotts Miracle-Gro Company (SMG - Free Report) is expanding its media and soil amendment portfolio as part of its multi-year SMG 2.0 growth plan by acquiring the Black Kow brand. The planned acquisition is built on SMG’s existing agreement, under which the company has been the exclusive producer, distributor and marketer of Black Kow since January 2026, with an option to buy. The company has announced its intention to exercise the option, with an expected close in October. Terms of the deal have not been disclosed.
The acquisition helps the company progress with its multi-year SMG 2.0 growth plan that is focused on achieving mid-range financial targets. Black Kow’s acquisition will aid innovation through revitalization of product lineups to drive premium growth by integrating it seamlessly into SMG’s core lawn and garden business. The portfolio will now additionally include organic amendments, mature manure and specialty soils.
Management expects the transaction to contribute to topline sales while maintaining the margin profile established by the company. The acquisition also underscores SMG’s disciplined capital allocation approach, with management describing it as a low-risk investment that is expected to support leverage ratio targets and be accretive to earnings per share beginning in the first year.
SMG plans to scale the Black Kow brand, a trusted 57-year-old name in the soil amendment category, through innovation and expand its availability nationwide by increasing household penetration. The deal also supports the company’s fiscal 2027-2029 growth algorithm, which targets 2-4% annual net sales growth, 50-100 basis points of adjusted gross margin improvement, 5-8% adjusted EPS growth, and free cash flow above $275 million.
SMG shares have lost 4.5% in the past year against the industry’s 11.5% growth.
Image Source: Zacks Investment Research
SMG’s Zacks Rank & Key Picks
SMG currently carries a Zacks Rank #3 (Hold)
Some better-ranked stocks in the Basic Materials space are Neo Performance Materials Inc. (NOPMF - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and Avient Corporation (AVNT - Free Report) .
While NOPMF currently sports a Zacks Rank #1 (Strong Buy), CRS and AVNT carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for NOPMF’s 2026 earnings is pegged at $1.4 per share, indicating a 185.71% year-over-year increase. NOPMF’sshares have gained 84.1% over the past year.
The Zacks Consensus Estimate for CRS’ fiscal 2027 earnings is pegged at $12.92 per share, indicating a rise of 20.07% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 8.39%.
The Zacks Consensus Estimate for AVNT’s current-year earnings is pinned at $3.2 per share, indicating a 13.48% year-over-year increase. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 3.4%. AVNT’sshares have gained 14.6% over the past year.