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The Scotts Miracle-Gro Company (SMG) — WACC Analysis

WACC Breakdown

The Scotts Miracle-Gro Company (SMG) has a weighted average cost of capital (WACC) of 7.8%. The cost of equity is 9.9%, derived from a beta of 1.23 and a risk-free rate of 5.0%. The after-tax cost of debt is 4.2%. The capital structure is 63.0% equity and 37.0% debt.

Interpretation

A WACC of 7.8% suggests that the market views The Scotts Miracle-Gro Company as relatively low-risk, with a lower cost of financing.

Investors can compare SMG's WACC of 7.8% against industry peers to gauge its relative financing costs. A beta of 1.23 reflects the stock's volatility relative to the broader market.

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VALUATION

SMG WACC: 7.82% for The Scotts Miracle-Gro Company

Current inputs imply a 9.93% cost of equity and a 5.36% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

The Scotts Miracle-Gro Company Common Stock (SMG) WACC Results
Weighted Average Cost of Capital
7.82%
Cost of Equity
9.93%
Risk-Free Rate5.05%
Beta1.23
Market Risk Premium4.23%
Cost of Debt
4.24%
Pre-Tax Cost of Debt5.36%
Tax Rate21.00%
Tax Shield1.13%
Capital Structure
Equity: 63.02%($3602.09M)
Debt: 36.98%($2113.30M)
Equity Component
6.26%
63.02% × 9.93%
Debt Component
1.57%
36.98% × 4.24%

The Scotts Miracle-Gro Company (SMG) WACC in context

The Scotts Miracle-Gro Company (SMG) currently screens with an estimated WACC of 7.82%. That blends a 9.93% cost of equity, a 5.36% pre-tax cost of debt, and a 63.02% equity weight into the discount rate you would typically use in a DCF model.

screens as a relatively low discount rate, which usually supports higher DCF values.

What SMG WACC implies

A 7.82% discount rate screens as a relatively low discount rate, which usually supports higher DCF values.

How this page calculates SMG

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 1.23 and equity accounts for 63.02% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.