Scotts Miracle-Gro (SMG) shares rallied 8.1% in the last trading session to close at $73.47. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock’s 8.4% gain over the past four weeks.
SMG’s gains reflect optimism over strong demand in its core U.S. Consumer business, supported by innovation and expanding presence, improving point-of-sale trends through enhanced transparency and strategic acquisitions. The company’s ongoing cost-saving initiatives, supply chain transformation and focus on higher-margin products are boosting profitability, while the divestiture of the Hawthorne business will streamline operations and improve earnings quality.
This lawn and garden products company is expected to post quarterly earnings of $2.53 per share in its upcoming report, which represents a year-over-year change of -2.3%. Revenues are expected to be $1.17 billion, down 1.2% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Scotts, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock’s price usually doesn’t keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on SMG going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>
Scotts is part of the Zacks Agriculture – Operations industry. Limoneira (LMNR), another stock in the same industry, closed the last trading session 2.2% higher at $14. LMNR has returned 7% in the past month.
Limoneira’s consensus EPS estimate for the upcoming report has remained unchanged over the past month at $0.16. Compared to the company’s year-ago EPS, this represents a change of +900%. Limoneira currently boasts a Zacks Rank of #2 (Buy).
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This article originally published on Zacks Investment Research (zacks.com).
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