The Scotts Miracle-Gro Company (NYSE: SMG)

This lawsuit is for anyone who acquired securities in The Scotts Miracle-Gro Company (NYSE: SMG) from November 3, 2021 through August 1, 2023.

The lawsuit alleges that the Company and certain of its executives violated federal law. Specifically, the lawsuit alleges that, throughout the time period mentioned above, the Company misled investors regarding its financial condition. More specifically, the lawsuit alleges that the Company misled investors by stuffing its channels of distribution for the purpose of artificially inflating revenue.

On June 8, 2022, Scotts announced that replenishment orders from its U.S. retailers were more than $300 million below target in the month of May, 2022, and disclosed 2022 full-year earnings would be roughly half of its prior guidance. The Company also announced plans to take on additional debt to cover restructuring charges as it attempted to cut costs. Analysts were shocked by the announcement, with one report by Truist commenting that, “[w]e have not seen anything similar occur in the 20 years we have covered [Scotts].” On this news, the price of the Company’s stock dropped precipitously on unusually heavy trading volume. Then, on August 2, 2023, the Company disclosed disappointing financial results, revealing that the Company’s quarterly sales for its fiscal third quarter of 2023 declined by 6%, and that gross margins fell by 420 basis points in the same period. The Company also announced a 25% reduction in fiscal year EBITDA guidance, and a $20 million write down of “pandemic driven excess inventories.” The Company also disclosed that it had to increase its debt covenants to 7.00 times debt-to-EBITDA ratio. On this news, the price of the Company’s stock again dropped precipitously on unusually heavy trading volume.

The Law Offices of Howard G. Smith seeks to recover damages on behalf of class members. If you acquired securities in The Scotts Miracle-Gro Company (NYSE: SMG) from November 3, 2021 through August 1, 2023 you may join the lawsuit by submitting your information online, or you may call the Law Offices of Howard G. Smith and speak to Mr. Smith directly to learn how he can protect your rights.