The Scotts Miracle-Gro Company (NYSE:SMG), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today we will analyse the most recent data on Scotts Miracle-Gro’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Scotts Miracle-Gro

What Is Scotts Miracle-Gro Worth?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 14.58% above our intrinsic value, which means if you buy Scotts Miracle-Gro today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth $61.95, there’s only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that Scotts Miracle-Gro’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

What kind of growth will Scotts Miracle-Gro generate?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted revenue growth of 8.9% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Scotts Miracle-Gro, at least in the short term.

What This Means For You

Are you a shareholder? SMG’s future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on SMG, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. For instance, we've identified 2 warning signs for Scotts Miracle-Gro (1 is a bit unpleasant) you should be familiar with.

If you are no longer interested in Scotts Miracle-Gro, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.