The Scotts Miracle Gro Co.’s (SMG) share price continues to chug forward, recently hitting a short-term level of resistance and approaching the 26-week high. The company’s recent success has been fueld by the resolution of a legal dispute with the Environmental Protection Agency.

Estimate Picture

Estimate have help steady in the last 2 months as analyst remain mostly upbeat about the company’s earnings. The current-year estimates is down a penny to $2.03 per share. Based upon this projection, this stock is reasonably priced, but trading at a premium to the overall market with a forward P/E multiple of 15X.

Fourth-Quarter Results

Scotts fourth-quarter results, reported in late October, were solid. Revenue was up 7% from last year to $544.2 million. One-time items hurt income, coming in at a loss of $34.7 million, an improvement from last year’s loss of $40.3 million. This produced a loss of 54 cents.

Regulatory Issues Resolved

The company said that its results were effected by a $10.3 loss on registration and recall costs and a one-time $13.5 million charge related to a write-down in the value of the company’s investment subsidiary Smith & Hawkins.

Scott ran into problems this year when the U.S. Environmental Protection Agency discovered that some of the company’s pesticides hadn’t been properly registered. With this calamity now behind the Scotts, the company anticipates moving back into profitability in 2009.

Full-Year Results

Full-year revenue came in at $2.98 billion, a 4% jump from the previous year.

The Chart

This stock has been steadily advancing since mid October, recently mvoing back to a key level of short-term resistance. Take a look below.

Content Courtesy: Zacks Investment Research

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