3M (MMM) AI Stock Analysis

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3M

(NYSE:MMM)

64Neutral

3M's overall stock score is 64, reflecting moderate strengths in earnings growth and strategic initiatives. However, financial challenges such as high leverage and cash flow issues, along with potential tariff impacts, temper the positive aspects. Valuation is reasonable, and recent corporate events signal a strategic focus on future growth.

Positive Factors

Earnings

1Q25 results came in ahead of expectations on EPS and operations.

Operational Efficiency

Operating equipment efficiency (OEE) was up 4 pts sequentially.

Negative Factors

Litigation Risks

Lawsuits in New Jersey and Vermont are considered more headline risk than material financial risk.

Tariff Impact

3M noted that the total annualized tariff impacts before any offsets is $850mn.

3M (MMM) vs. S&P 500 (SPY)

Market Cap

$74.28B

Dividend Yield1.98%

Average Volume (3M)4.28M

Price to Earnings (P/E)17.8

Beta (1Y)1.02

Revenue Growth-24.93%

EPS GrowthN/A

CountryUS

Employees61,500

SectorIndustrials

Sector Strength82

IndustryConglomerates

Share Statistics

EPS (TTM)1.88

Shares Outstanding538,181,340

10 Day Avg. Volume3,273,650

30 Day Avg. Volume4,276,687

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.18

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit8.64

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$147.30

Price Target Upside3.30% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

3M Business Overview & Revenue Model

Company Description3M Company operates as a diversified technology company worldwide. It operates through four segments: Safety and Industrial; Transportation and Electronics; Health Care; and Consumer. The Safety and Industrial segment offers industrial abrasives and finishing for metalworking applications; autobody repair solutions; closure systems for personal hygiene products, masking, and packaging materials; electrical products and materials for construction and maintenance, power distribution, and electrical original equipment manufacturers; structural adhesives and tapes; respiratory, hearing, eye, and fall protection solutions; and natural and color-coated mineral granules for shingles. The Transportation and Electronics segment provides ceramic solutions; attachment tapes, films, sound, and temperature management for transportation vehicles; premium large format graphic films for advertising and fleet signage; light management films and electronics assembly solutions; packaging and interconnection solutions; and reflective signage for highway, and vehicle safety. The Healthcare segment offers food safety indicator solutions; health care procedure coding and reimbursement software; skin, wound care, and infection prevention products and solutions; dentistry and orthodontia solutions; and filtration and purification systems. The Consumer segment provides consumer bandages, braces, supports and consumer respirators; cleaning products for the home; retail abrasives, paint accessories, car care DIY products, picture hanging, and consumer air quality solutions; and stationery products. It offers its products through e-commerce and traditional wholesalers, retailers, jobbers, distributors, and dealers. The company was founded in 1902 and is based in St. Paul, Minnesota.

How the Company Makes Money3M makes money through a diverse revenue model that encompasses several key segments. The Industrial segment is a significant contributor, providing products like tapes, abrasives, adhesives, and filtration solutions to various industries. The Safety and Graphics segment generates revenue from personal protective equipment, security products, and commercial graphics. The Health Care segment offers medical and surgical supplies, oral care solutions, and drug delivery systems. The Electronics and Energy segment provides materials for electronics manufacturing and energy solutions. The Consumer segment includes household products, office supplies, and stationery, such as the well-known Post-it and Scotch brands. 3M's earnings are supported by strategic partnerships and a strong global presence, allowing it to leverage its broad product portfolio and innovation to meet customer needs across diverse markets.

3M Key Performance Indicators (KPIs)

Any

Net Sales by Segment

Net Sales by Segment
Shows sales performance across different business segments, highlighting which areas are driving growth and which may need strategic adjustments.

Chart Insights3M's net sales reveal a mixed performance across segments. The Healthcare segment has been phased out, impacting overall sales. While Safety and Industrial and Consumer segments show stability, the Transportation and Electronics segment faces challenges, aligning with earnings call concerns about auto and electronics weakness. Despite these hurdles, 3M's strategic focus on launching new products and improving margins is promising. The company aims to counter tariff impacts with cost offsets and share buybacks, indicating a proactive approach to maintaining shareholder value.

Data provided by:

Main Street Data

3M Financial Statement Overview

Summary

3M presents a mixed financial picture with strong profitability metrics like EBIT margin and ROE but is offset by high leverage and declining revenues. Cash flow issues further compound these challenges, suggesting a need for careful financial management to navigate potential risks.

Income Statement

Positive

3M's income statement shows a stable gross profit margin with a current TTM of 40.96%. However, net income has been inconsistent, with a TTM net profit margin of 17.79%. Revenue growth has been negative in recent years, reflecting a decline in sales from 2021 to 2024. The EBIT margin for TTM is strong at 20.06%, suggesting efficient operations despite revenue challenges.

Balance Sheet

Neutral

The balance sheet reveals a high debt-to-equity ratio of 3.15, indicating significant leverage, which could pose financial risks. The equity ratio stands at 11.18%, signaling a low proportion of equity financing. Return on equity is robust at 97.68% for TTM, driven by the low equity base, but this also highlights potential volatility in returns.

Cash Flow

Neutral

3M's cash flow statement shows a decline in operating cash flow with a TTM free cash flow of -$69 million. The free cash flow growth rate is negative, reflecting cash flow challenges. The operating cash flow to net income ratio is 0.22, indicating that operating activities are not strongly supporting net income.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
24.57B	32.68B	34.23B	35.35B	32.18B
	Gross Profit
10.13B	14.20B	15.00B	16.56B	15.58B
	EBIT
4.82B	-9.13B	6.54B	5.45B	4.47B
	EBITDA
4.82B	-6.75B	8.72B	9.58B	9.26B
	Net Income Common Stockholders
4.17B	-7.00B	5.78B	5.92B	5.45B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
7.73B	5.99B	3.89B	4.76B	5.04B
	Total Assets
39.87B	50.58B	46.45B	47.07B	47.34B
	Total Debt
13.66B	16.85B	16.20B	17.63B	19.05B
	Net Debt
8.06B	10.92B	12.54B	13.06B	14.42B
	Total Liabilities
35.97B	45.71B	31.68B	31.95B	34.41B
	Stockholders Equity
3.84B	4.81B	14.77B	15.12B	12.93B
Cash Flow		Free Cash Flow
638.00M	5.07B	3.84B	5.85B	6.61B
	Operating Cash Flow
1.82B	6.68B	5.59B	7.45B	8.11B
	Investing Cash Flow
-3.21B	-1.21B	-1.05B	-1.32B	-580.00M
	Financing Cash Flow
1.10B	-3.15B	-5.35B	-6.14B	-5.30B

3M Technical Analysis

Technical Analysis Sentiment

Positive

Last Price142.60

Price Trends

50DMA

142.47

Positive

100DMA

141.64

Positive

200DMA

135.33

Positive

Market Momentum

MACD

0.11

Negative

RSI

55.44

Neutral

STOCH

72.49

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMM, the sentiment is Positive. The current price of 142.6 is above the 20-day moving average (MA) of 136.95, above the 50-day MA of 142.47, and above the 200-day MA of 135.33, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 55.44 is Neutral, neither overbought nor oversold. The STOCH value of 72.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MMM.

3M Risk Analysis

3M disclosed 15 risk factors in its most recent earnings report. 3M reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

3M Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HON	76 Outperform	$134.92B	24.61	33.56%	2.07%	6.30%	0.81%
VMI	75 Outperform	$6.09B	17.84	22.84%	0.80%	-0.57%	116.12%
MDU	73 Outperform	$3.58B	12.67	9.63%	2.94%	-25.50%	-45.13%
GFF	72 Outperform	$3.38B	14.48	110.90%	0.96%	-3.38%	26.22%
MMM	64 Neutral	$74.28B	17.79	94.75%	1.98%	-24.93%	―
Sector *	64 Neutral	$4.30B	11.84	5.23%	249.82%	4.10%	-10.59%
SEB	55 Neutral	$2.46B	25.41	2.09%	0.36%	-0.31%	-58.07%

* Industrials Sector Average

Performance Comparison

MMM

142.60

45.19

46.39%

GFF

Griffon

68.48

-0.17

-0.25%

HON

Honeywell International

213.03

13.46

6.74%

MDU

Mdu Resources Group

17.37

3.72

27.25%

SEB

Seaboard

2,510.00

-850.13

-25.30%

VMI

Valmont

309.18

51.49

19.98%

3M Earnings Call Summary

Earnings Call Date:Apr 22, 2025

(Q1-2025)

% Change Since: 13.09%|

Next Earnings Date:Jul 29, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced view of 3M's performance, highlighting strong earnings, margin improvements, and new product launches. However, concerns were noted regarding the impact of tariffs and weakness in key sectors like auto and electronics.

Q1-2025 Updates

Positive Updates

Strong Earnings and Margin Improvement

First quarter adjusted earnings per share of $1.88, up 10% versus last year with operating margins increasing by 220 basis points year over year.

Positive Organic Sales Growth

Organic sales growth was 1.5%, with all business groups posting positive growth.

Increased New Product Launches

Launched 62 new products in Q1, a 60% increase year-over-year, with a goal to launch 215 new products this year.

Strong Cash Flow and Shareholder Returns

Free cash flow was solid at $0.5 billion; returned $1.7 billion to shareholders and raised the dividend by 4%.

Operational Excellence Initiatives

On-time in full delivery increased to 89%, the best in five years, and equipment utilization improved by 4 percentage points.

Negative Updates

Tariff Impact Concerns

Tariffs are expected to have a $400 million impact this year, with a potential $0.60 EPS headwind before mitigation efforts.

Weakness in Auto and Electronics

Continued weakness in auto builds, particularly in Europe and the US, with mid-single-digit decline in auto OEM business.

Geographic Challenges

Organic sales decreased in Europe due to a weak environment and high single-digit decline in auto builds.

Company Guidance

During the 3M First Quarter Earnings Conference Call, guidance for the fiscal year 2025 was outlined with several key metrics. The company reported a strong start with first-quarter adjusted earnings per share of $1.88, representing a 10% increase compared to last year, and organic sales growth of 1.5%. Operating margins improved by 220 basis points year-over-year, and free cash flow was approximately $0.5 billion. The company aims to launch 215 new products this year, with a long-term goal of 1,000 new products over the next three years. 3M has set its full-year adjusted earnings per share guidance between $7.60 and $7.90, excluding the impact of tariffs, and plans to mitigate the $0.60 EPS headwind from tariffs with $0.20 to $0.40 in offsets. The company also raised its dividend by 4%, authorized a $7.5 billion share repurchase program, and expects to execute $2 billion in share buybacks, up from the previously anticipated $1.5 billion.

3M Corporate Events

Business Operations and StrategyFinancial Disclosures

3M Unveils Strategic Plan at 2025 Investor Day

Positive

Feb 26, 2025

On February 26, 2025, 3M Company held its 2025 Investor Day in St. Paul, Minnesota, where it provided a strategic update and medium-term financial outlook. The company highlighted its plans to accelerate sales growth through innovation and operational excellence, aiming for an operating margin of approximately 25% by 2027 and high-single-digit EPS growth annually. 3M also outlined a capital deployment framework, focusing on investing in the business and returning at least $10 billion in cash to shareholders. These initiatives are expected to enhance 3M’s market positioning and deliver sustainable value to its stakeholders.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.