How Investors Are Reacting To Scotts Miracle-Gro (SMG) Considering Exit From Cannabis ...

Simply Wall St analyzes Scotts Miracle-Gro's strategic shift as the company explores exiting the cannabis market by selling its Hawthorne Gardening subsidiary.

Scotts Miracle-Gro is considering divesting from cannabis operations after investing nearly $2 billion in the venture, citing federal regulations and industry overproduction challenges. The company plans to refocus on its core consumer lawn and garden business, which shows more stability with projected low single-digit growth. This strategic pivot aims to reduce earnings volatility while maintaining the option to re-enter cannabis markets if regulatory conditions improve.

• Company exploring sale of Hawthorne Gardening subsidiary following cannabis market difficulties and declining sales
• Nearly $2 billion invested in cannabis venture with potential future re-entry if regulations change
• Refocusing on core consumer business with low single-digit growth projections for stability
• Fair value estimates range from $48.25 to $87.71 per share, suggesting potential investment opportunities