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3M Company (MMM), headquartered in Saint Paul, Minnesota, is a technology company that manufactures industrial, safety and consumer products. Valued at $56.07 billion by market cap, the company’s portfolio of products includes advanced materials, display materials and systems, home care, home improvement, stationery and office, personal safety, roofing granules, closure and masking systems, and others. The industrial products and solutions giant is expected to announce its fiscal second-quarter earnings for 2024 on Tuesday, July 23.
Ahead of the event, analysts expect MMM to report a profit of $1.66 per share on a diluted basis, down 23.5% from $2.17 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports. During Q1, MMM’s net income and revenue were $928 million and $8 billion, respectively. Its adjusted EPS was $2.39, beating the consensus estimate of $2.08.
For fiscal 2024, analysts expect MMM to report EPS of $7.17, down 22.4% from $9.24 in fiscal 2023.
MMM stock has underperformed the S&P 500’s ($SPX) 25.2% gains over the past 52 weeks, with shares up 23.3% during this period. However, it has outperformed the S&P 500 Industrial Sector SPDR’s (XLI) 13.5% return over the same time frame.
On Jun. 7, MMM shares closed up more than 2% after Bank of America analyst Andrew Obin upgraded the stock to Buy from Neutral with a price target of $120, up from $105.
MMM’s overall performance can be attributed to the reduction in uncertainties that have plagued the business in the past few years, such as entering into a settlement agreement with Public Water Suppliers over the production of PFAS chemicals and a $6 billion lawsuit settlement as part of the Combat Arms Earplug settlement under which more than 249,000 veterans would receive payouts.
Moreover, it has spun off its healthcare business, Solventum, which will result in cash payments of $7.7 billion to the company. It will also retain a 19.9% stake in Solventum that can be monetized within five years to raise cash. MMM has also cut its dividend, which will enable the company to invest in its growth. The company expects its adjusted EPS for the full year to be between $6.80 and $7.30.
Analysts’ consensus opinion on MMM stock is cautious, with a “Hold” rating overall. Out of 12 analysts covering the stock, four advise a “Strong Buy” rating, six have a “Hold” rating, and two give a “Strong Sell.” The average analyst price target for MMM is $110.85, indicating a 9.4% potential upside from the current levels.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
