Analyzing Scotts Miracle-Gro (NYSE:SMG) and Alico (NASDAQ:ALCO)

Scotts Miracle-Gro (NYSE:SMG) and Alico (NASDAQ:ALCO) are both consumer staples companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Volatility and Risk

Scotts Miracle-Gro has a beta of 1.95, suggesting that its share price is 95% more volatile than the S&P 500. Comparatively, Alico has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500.

Earnings & Valuation

This table compares Scotts Miracle-Gro and Alico”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Scotts Miracle-Gro	$3.41 billion	1.09	$145.20 million	$1.47	43.60
Alico	$44.07 million	7.18	-$147.33 million	($19.28)	-2.14

Scotts Miracle-Gro has higher revenue and earnings than Alico. Alico is trading at a lower price-to-earnings ratio than Scotts Miracle-Gro, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Scotts Miracle-Gro and Alico’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Scotts Miracle-Gro	2.68%	-68.59%	7.29%
Alico	-334.35%	-78.98%	-45.51%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Scotts Miracle-Gro and Alico, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Scotts Miracle-Gro	0	3	5	0	2.63
Alico	1	0	1	0	2.00

Scotts Miracle-Gro currently has a consensus target price of $71.00, indicating a potential upside of 10.79%. Alico has a consensus target price of $42.00, indicating a potential upside of 1.67%. Given Scotts Miracle-Gro’s stronger consensus rating and higher probable upside, analysts clearly believe Scotts Miracle-Gro is more favorable than Alico.

Dividends

Scotts Miracle-Gro pays an annual dividend of $2.64 per share and has a dividend yield of 4.1%. Alico pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. Scotts Miracle-Gro pays out 179.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alico pays out -1.0% of its earnings in the form of a dividend.

Institutional & Insider Ownership

74.1% of Scotts Miracle-Gro shares are held by institutional investors. Comparatively, 62.3% of Alico shares are held by institutional investors. 24.4% of Scotts Miracle-Gro shares are held by company insiders. Comparatively, 6.7% of Alico shares are held 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.

Summary

Scotts Miracle-Gro beats Alico on 14 of the 16 factors compared between the two stocks.

About Scotts Miracle-Gro

The Scotts Miracle-Gro Company, together with its subsidiaries, manufactures, markets, and sells products for lawn, garden care, and indoor and hydroponic gardening in the United States and internationally. It operates through three segments: U.S. Consumer, Hawthorne, and Other. The company provides lawn care products, comprising lawn fertilizers, grass seed products, spreaders, and other durable products, as well as lawn-related weed, pest, and disease control products; and gardening and landscape products, which include water-soluble and continuous-release plant foods, potting mixes, garden soils, mulches and ground cover products, plant-related pest and disease control products, organic garden products, and live goods and seeding solutions. It offers hydroponic products that help users to grow plants, flowers, and vegetables using little or no soil; lighting systems and components for use in hydroponic and indoor gardening applications; insect, rodent, and weed control products for home areas; and non-selective weed killer products. The company sells its products under the Scotts, Turf Builder, EZ Seed, PatchMaster, Thick'R Lawn, GrubEx, EdgeGuard, Handy Green II, Miracle-Gro, LiquaFeed, Shake N Feed, Hyponex, Earthgro, Nature Scapes, Ortho, Miracle-Gro Performance Organics, Miracle-Gro Organic Choice, Whitney Farms, EcoScraps, Mother Earth, Botanicare, General Hydroponics, Cyco, Gavita, Agrolux, HydroLogic Purification System, Gro Pro, AeroGarden, Titan, Tomcat, Ortho Weed B Gon, Roundup, Groundclear, and Alchemist brands. It serves home centers, mass merchandisers, warehouse clubs, large hardware chains, independent hardware stores, nurseries, garden centers, e-commerce platforms, and food and drug stores, as well as indoor gardening and hydroponic distributors, retailers, and growers. The Scotts Miracle-Gro Company was founded in 1868 and is headquartered in Marysville, Ohio.

About Alico

Alico, Inc., together with its subsidiaries, operates as an agribusiness and land management company in the United States. The company operates in two segments, Alico Citrus, and Land Management and Other Operations. The Alico Citrus segment engages in planting, owning, cultivating, and/or managing citrus groves to produce fruit for sale to fresh and processed citrus markets, including activities related to the purchase and resale of fruit and value-added services, which include contracting for the harvesting, marketing, and hauling of citrus. The Land Management and Other Operations segment is involved in the activities related to native plant sales, grazing and hunting leasing, management, and/or conservation of unimproved native pastureland; and activities related to rock mining royalties and other insignificant lines of business, as well as in the activities related to owning and/or leasing improved farmland. The company was incorporated in 1960 and is based in Fort Myers, Florida.