We recently published a list of 14 Best Farmland and Agriculture Stocks to Buy Now. In this article, we are going to take a look at where The Scotts Miracle-Gro Company (NYSE:SMG) stands against other best farmland and agriculture stocks to buy now.
The American Agriculture Sector and Trump’s Tariffs
At the beginning of March, the White House announced the imposition of 25% tariffs on goods from Mexico and Canada and additional 10% tariffs on China. While President Trump granted a one-month tariff delay for automakers and paused the same for certain Mexican and Canadian goods until April 2, he announced in an interview with Fox News that tariffs “could go up” with time.
Since tariffs on Chinese goods weren’t a part of the exemptions, China imposed retaliatory tariffs on the US, particularly targeting US agricultural goods. Specifically, a 10% tariff was imposed on American soybeans, while corn was hit with an additional 15% charge. CNBC reported that China is prepared to fight “any type of war” with the United States. The news channel reported that the Chinese Embassy in the US reported in a post on X:
“If war is what the U.S. wants, be it a tariff war, a trade war, or any other type of war, we’re ready to fight till the end.”
A Chinese foreign ministry spokesperson also labeled the American fentanyl-related explanation for imposing tariffs a “flimsy excuse.”
READ ALSO: 10 Best Consumer Staples Stocks to Buy According to Analysts and 10 Best Mid Cap Biotech Stocks to Buy.
Could Tariffs Reduce Agriculture Goods Prices for Americans?
On March 4, Landus Cooperative CEO, Matt Carstens, appeared on CNBC’s ‘The Exchange’ to talk about how tariffs could potentially slash the prices of various agricultural products and discuss the long-term benefits of these tariffs on agricultural markets. He said that a significant need to find markets exists for American farmers. Corn makes up about 20% of any given year that the US exports to other countries, while soybean reaches up to as much as 50% of America’s production going to other markets. This creates an interesting dynamic that puts considerable pressure on the ongoing circumstances.
Carstens was of the view that the American farmers hopefully understand that the government is playing the long game here and working on something that would hopefully be significantly profitable for America in the long run. That translates to opportunities for farmers to get the most for commodities, something that they need to a great extent at the present. However, in the short term, we have to deal with these changes in the market.
In other words, Carstens said that the scenario could benefit consumers because the US is flooded with the said agricultural product. Since it is comparatively more expensive to export these products, American consumers get cheaper soybeans and corn, but the farmers potentially lose their export business. There is, thus, a balance that comes into play. The market will certainly see price decreases as export slows and supply increases. However, the farmers are dealing with prices that continue to escalate amid other costs.
Our Methodology
We sifted through stock screeners, financial media reports, and ETFs to compile a list of 30 farmland and agriculture stocks and chose the top 14 most popular stocks among hedge funds. The list is ordered in ascending order of the number of hedge funds as of fiscal Q4 2024. We sourced the hedge fund sentiment data from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A farmer standing in a lush field of vegetables that has been enhanced by the company’s hydroponic products.
The Scotts Miracle-Gro Company (NYSE:SMG)
Number of Hedge Fund Holders: 33
The Scotts Miracle-Gro Company (NYSE:SMG) manufactures and markets branded garden and lawn care consumer products. Its segments are divided into US Consumer, Hawthorne, and Other. The US Consumer segment offers various consumer lawn and garden products, including Scotts and Turf Builder lawn fertilizer and grass seed products, Ortho herbicide and pesticide products, Miracle-Gro soil, plant food and gardening products, and Tomcat rodent control and animal repellent products. Its brand portfolio primarily comprises Gavita, General Hydroponics, Gro Pro, Botanicare, Agrolux, Mother Earth, and more.
The company reported better-than-expected fiscal Q1 2025 results, with its EPS of -$0.89 exceeding expectations of -$1.23. It also reported a 1.56% growth in revenue, reaching $416.8 million and surpassing estimates by $24.76 million. The Scotts Miracle-Gro Company (NYSE:SMG) is focusing on expanding its market share and customer base by investing an additional $40 million in its operations, ranging from innovation to brand support. A significant share of this investment is focused on advertising. The company is also developing a multi-year plan to optimize its business and slash costs, which will result in $400 million in annual savings.
On April 2, Truist analyst Bill Chappell upgraded Scotts Miracle-Gro Company (NYSE:SMG) to Buy from Hold with an unchanged price target of $70. The analyst told investors that the lawn and garden category in the US has finally normalized after COVID-19. According to the analyst, both Scotts Miracle-Gro Company (NYSE:SMG) and the sector are well-positioned to manage the macroturbulence anticipated to affect consumers over the next year. The analyst also said that the stock’s valuation is “highly attractive on a historical basis.”
Overall, SMG ranks 9th on our list of best farmland and agriculture stocks to buy now. While we acknowledge the potential for SMG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than SMG but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
