Glancy Prongay & Murray LLP Reminds Investors of Looming Deadline in the Class Action Lawsuit Against The Scotts Miracle-Gro Company (SMG)

Core Viewpoint - The Scotts Miracle-Gro Company is facing a class action lawsuit due to alleged misleading statements and undisclosed adverse facts regarding its business operations and financial performance during the specified Class Period from November 3, 2021, to August 1, 2023 [1][3]. Financial Performance - In May 2022, Scotts reported that replenishment orders from U.S. retailers were over $300 million below target, leading to a significant reduction in full-year earnings guidance to approximately half of prior expectations [2]. - On August 2, 2023, Scotts disclosed a 6% decline in quarterly sales for its fiscal third quarter and a 420 basis point drop in gross margins, alongside a 25% reduction in fiscal year EBITDA guidance and a $20 million write-down of excess inventories [2]. Allegations in Class Action - The class action complaint alleges that Scotts had an oversupply of inventory that exceeded consumer demand and that executives engaged in practices to pressure retailers into purchasing more inventory than needed [3]. - It is claimed that the company relied on a "channel stuffing" scheme to meet debt covenants, which misled investors regarding the company's true business health [3]. Stock Price Impact - Following the May 2022 announcement, Scotts' stock price fell by $9.05, or 8.9%, closing at $93.13 per share [6]. - After the August 2023 financial disclosure, the stock price dropped by $13.58, or 19%, closing at $57.86 per share [7].