Scotts Miracle-Gro upgraded to Buy at Stifel on valuation

Stifel analyst W. Andrew Carter upgraded Scotts Miracle-Gro (SMG) to Buy from Hold with a lower price target of $70, down from $78. The stock is now down 28% from its late-January peak to a forward earnings multiple of just under 15-times – a discount to its to consumer staples peers, the analyst tells investors in a research note. The stock’s recent underperformance disproportionately overweights universal macroeconomic concerns despite the company boasting key points of differentiation alongside adverse January/February and also “dramatically undervalues” Scotts Miracle-Gro’s robust near-term earnings recovery and advantaged long-term growth profile stemming from the U.S. Consumer business’s position of strength, Stifel adds.