3M Company (MMM) 2Q earnings of $1.78 per share missed analysts’ expectations of $1.80. In addition, its revenues of $7.2 billion also fell short of the consensus estimate of $7.3 billion.
The company reported a sharp fall in demand across all of its business segments amid the closure of retail stores. Meanwhile, 3M’s personal safety products experienced strong growth, driven by a surge in N95 mask sales.
3M produced around 800 million respirators in the first half of this year and targets to produce 2 billion masks in 2020.
On July 29, RBC Capital analyst Deane Dray lifted the stock’s price target to $170 (9.4% upside potential) from $158 but reiterated a Hold rating. Dray said he is disappointed with the company’s 2Q earnings results and the weaker-than-expected margins outlook for 3Q. However, he remains encouraged about “a potential positive inflection in July sales, as month-to-date revenues were up low-single-digits from last year amid improvement across all geographies and businesses.”
Currently, the Street has a cautious outlook on the stock. The Hold analyst consensus is based on 4 Holds, 2 Sells, and 1 Buy. The average price target of $165.71 implies upside potential of 6.7%. (See MMM stock analysis on TipRanks).