Scotts Miracle-Gro Company (The) (NYSE: SMG) and Ciner Resources (NYSE:CINR) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, profitability, analyst recommendations, risk and valuation.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Scotts Miracle-Gro Company (The) and Ciner Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Scotts Miracle-Gro Company (The) 0 2 2 0 2.50
Ciner Resources 0 2 1 0 2.33

Scotts Miracle-Gro Company (The) presently has a consensus price target of $100.00, indicating a potential upside of 6.10%. Ciner Resources has a consensus price target of $28.75, indicating a potential upside of 19.79%. Given Ciner Resources’ higher possible upside, analysts plainly believe Ciner Resources is more favorable than Scotts Miracle-Gro Company (The).

Institutional and Insider Ownership

69.0% of Scotts Miracle-Gro Company (The) shares are owned by institutional investors. Comparatively, 9.3% of Ciner Resources shares are owned by institutional investors. 28.2% of Scotts Miracle-Gro Company (The) shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Scotts Miracle-Gro Company (The) and Ciner Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Scotts Miracle-Gro Company (The) 7.85% 36.28% 7.67%
Ciner Resources 8.18% 15.65% 9.52%

Volatility and Risk

Scotts Miracle-Gro Company (The) has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500. Comparatively, Ciner Resources has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Earnings and Valuation

This table compares Scotts Miracle-Gro Company (The) and Ciner Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Scotts Miracle-Gro Company (The) $2.93 billion 1.88 $517.80 million $3.81 24.74
Ciner Resources $490.40 million 0.99 $115.10 million $1.99 12.06

Scotts Miracle-Gro Company (The) has higher revenue and earnings than Ciner Resources. Ciner Resources 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.

Dividends

Scotts Miracle-Gro Company (The) pays an annual dividend of $2.12 per share and has a dividend yield of 2.2%. Ciner Resources pays an annual dividend of $2.27 per share and has a dividend yield of 9.5%. Scotts Miracle-Gro Company (The) pays out 55.6% of its earnings in the form of a dividend. Ciner Resources pays out 114.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ciner Resources has raised its dividend for 7 consecutive years. Ciner Resources is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Scotts Miracle-Gro Company (The) beats Ciner Resources on 11 of the 17 factors compared between the two stocks.

About Scotts Miracle-Gro Company (The)

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.

About Ciner Resources

Ciner Resources LP, through its subsidiary, Ciner Wyoming LLC (Ciner Wyoming), produces soda ash and serves a global market from its facility in the Green River Basin of Wyoming. The Company processes trona ore into soda ash, a raw material in flat glass, container glass, detergents, chemicals, paper and other consumer and industrial products. As of December 31, 2016, its Green River Basin surface operations were situated on approximately 880 acres in Wyoming, and the Company’s mining operations included approximately 23,500 acres of leased and licensed subsurface mining area. The Company’s mining leases and license are located in two mining beds, designated by the United States Geological Survey as beds 24 and 25, at depths of 800 to 1100 feet, respectively, below the surface. The Company uses a continuous mining technique to mine trona and roof bolt the ceiling simultaneously. The Company’s soda ash is shipped by rail or truck from its Green River Basin operations.

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