What Analysts Expect for Scotts Miracle-Gro’s Earnings Margins



EBITDA margins

Similar to the gross margin expectations, the EBITDA (earnings before interest, tax, depreciation, and amortization) margins are also expected to expand for The Scotts Miracle-Gro Company (SMG) in the next four quarters. Let’s look at analysts’ estimates below.

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Analysts’ estimates

For 4Q17, analysts expect that Scotts Miracle-Gro will report an EBITDA income of $11 million, which would result in an EBITDA margin of 3% during the quarter. For the next four quarters, analysts expect an EBITDA of $557 million, which translates into an EBITDA margin of 20.3%. It’s expected to expand from a margin of 19.1% on an EBITDA income of $560 million in the recent four quarters.

The EBITDA margins are estimated to fall slightly by 67 basis points YoY (year-over-year) in the next four quarters. However, the company is estimated to have improved EBITDA margins. Similar to the gross margins, the cost optimization appears to be driving the margin’s improvement.

Peers’ expectations

Central Garden & Pet (CENT) is expected to report an EBITDA margin of 10% in the next four quarters. Spectrum Brands Holdings (SPB) is expected to report an EBITDA margin of 19.4%, while Andersons (ANDE) is expected to report an EBITDA margin of 4.4% in the next four quarters.

In the next part, we’ll discuss the EPS (earnings per share) estimates for Scotts Miracle-Gro compared to its peers (MXI).


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