Lawn care titan Scotts Miracle-Gro (SMG 0.92%) is a selection for the real-money Inflation-Protected Income Growth portfolio. In this brief video, portfolio manager Chuck Saletta points out the 2.5 reasons why he's continuing to hold the company's stock.
Summary
- Scotts Miracle-Gro's balance sheet looks reasonable.
- Its dividend is covered and likely has room to continue growing.
- Its valuation looks reasonable if it delivers a successful summer season.
Scotts Miracle-Gro's pattern of dividend growth sets it apart from its competition. Central Garden and Pet (CENT 0.18%) (CENTA -0.04%) does not pay a dividend at all. Spectrum Brands (SPB 0.15%) only recently started increasing its dividend, and with a 64% payout ratio, that dividend is not as well-covered as Scotts Miracle-Gro's.
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