Scotts Miracle-Gro Company (The) (NYSE: SMG) and Compass Minerals International (NYSE:CMP) are both mid-cap basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, dividends, valuation, earnings, institutional ownership and profitabiliy.

Analyst Ratings

This is a summary of recent ratings for Scotts Miracle-Gro Company (The) and Compass Minerals International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Scotts Miracle-Gro Company (The) 0 1 4 0 2.80
Compass Minerals International 0 2 0 0 2.00

Scotts Miracle-Gro Company (The) currently has a consensus price target of $95.00, indicating a potential upside of 1.96%. Compass Minerals International has a consensus price target of $69.00, indicating a potential upside of 2.53%. Given Compass Minerals International’s higher possible upside, analysts clearly believe Compass Minerals International is more favorable than Scotts Miracle-Gro Company (The).

Volatility & Risk

Scotts Miracle-Gro Company (The) has a beta of 0.39, indicating that its share price is 61% less volatile than the S&P 500. Comparatively, Compass Minerals International has a beta of 0.44, indicating that its share price is 56% less volatile than the S&P 500.

Valuation and Earnings

This table compares Scotts Miracle-Gro Company (The) and Compass Minerals International’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Scotts Miracle-Gro Company (The) $2.85 billion 1.95 $478.40 million $4.72 19.74
Compass Minerals International $1.18 billion 1.93 $250.70 million $3.95 17.04

Scotts Miracle-Gro Company (The) has higher revenue and earnings than Compass Minerals International. Compass Minerals International is trading at a lower price-to-earnings ratio than Scotts Miracle-Gro Company (The), indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

68.2% of Scotts Miracle-Gro Company (The) shares are owned by institutional investors. 28.2% of Scotts Miracle-Gro Company (The) shares are owned by company insiders. Comparatively, 0.8% of Compass Minerals International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

Scotts Miracle-Gro Company (The) pays an annual dividend of $2.00 per share and has a dividend yield of 2.1%. Compass Minerals International pays an annual dividend of $2.88 per share and has a dividend yield of 4.3%. Scotts Miracle-Gro Company (The) pays out 42.4% of its earnings in the form of a dividend. Compass Minerals International pays out 72.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Scotts Miracle-Gro Company (The) has increased its dividend for 13 consecutive years and Compass Minerals International has increased its dividend for 7 consecutive years.

Profitability

This table compares Scotts Miracle-Gro Company (The) and Compass Minerals International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Scotts Miracle-Gro Company (The) 10.23% 31.76% 6.98%
Compass Minerals International 11.40% 11.86% 3.88%

Summary

Scotts Miracle-Gro Company (The) beats Compass Minerals International on 13 of the 17 factors compared between the two stocks.

Scotts Miracle-Gro Company (The) Company Profile

The Scotts Miracle-Gro Company (Scotts Miracle-Gro) is a manufacturer and marketer of branded consumer lawn and garden products. The Company’s segments include Global Consumer. In North America, its brands include Scotts and Turf Builder lawn and grass seed products; Miracle-Gro, Nature’s Care, Scotts, LiquaFeed and Osmocote gardening and landscape products; and Ortho, Roundup, Home Defense and Tomcat branded insect control, weed control and rodent control products. In the United Kingdom, its brands include Miracle-Gro plant fertilizers; Roundup, Weedol and Pathclear herbicides; EverGreen lawn fertilizers, and Levington gardening and landscape products.

Compass Minerals International Company Profile

Compass Minerals International, Inc. (CMI) is a provider of essential minerals that solve nature’s challenges, including salt for winter roadway safety and other consumer, industrial and agricultural uses; specialty plant nutrition minerals for the quality and yield of crops, and specialty chemicals for water treatment and other industrial processes. The Company has three segments: Salt, Plant Nutrition North America and Plant Nutrition South America. The Salt segment produces and markets salt and magnesium chloride for use in road deicing and dust control, food processing, water softeners, and agricultural and industrial applications. Its Plant Nutrition North America segment includes sales of sulfate of potash (SOP) specialty fertilizer and micronutrients. The Plant Nutrition South America segment operates two primary businesses in Brazil: agricultural productivity and chemical solutions.

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