Scotts Miracle-Gro, the maker of lawn and garden care products, said Monday its board approved a dividend increase of 20% to 30 cents per share. The higher dividend will be paid on Sept. 9 to shareholders of record on Aug. 26.
That brings Scotts' dividend yield to around 2.6% based on Friday's closing price, but the company's stock price shed nearly 12% Monday afternoon as the major indexes tumbled more than 4% following an unprecedented downgrade to the U.S. government's AAA credit rating by Standard & Poor's on Friday.
Procter & Gamble (PG) had been among the few consumer stocks trading higher on Monday, but even the Dow component was unable to hold its gains amid Monday's market selloff.
Based on Monday's trading price, Scotts' higher dividend indicated a yield of around 3%. Earlier Monday, Scotts posted a 37% decline in fiscal third-quarter earnings, saying poor weather across the U.S. in recent months pressured consumer demand for lawn and garden care maintenance. "Through mid-March, consumer purchases of our products in the U.S. were up 13%, but then the situation changed dramatically," CEO Jim Hagedorn said. "The challenges we saw from weather this year are unparalleled during my life-long tenure in this industry."
The company cut its fiscal 2011 outlook by 15 cents, saying it now expects to earn between $2.95 and $3.05 per share for the year. Analysts were looking for 2011 EPS of $3.14. In the June-ended quarter, Scotts earned $111.6 million, or $1.69 per share, compared with year-earlier earnings of $175.9 million, or $2.59 per share. Revenue fell 9.7% to $1.06 billion. --Written by Miriam Marcus Reimer in New York.
>To contact the writer of this article, click here: Miriam Reimer. >To follow the writer on Twitter, go to http://twitter.com/miriamsmarket. >To submit a news tip, send an email to: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV