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3M (MMM) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3 mins read

3M (MMM) closed at $167.71 in the latest trading session, marking a +0.73% move from the prior day. The stock lagged the S&P 500's daily gain of 0.8%. At the same time, the Dow added 0.43%, and the tech-heavy Nasdaq gained 0.5%.

MMM will be looking to display strength as it nears its next earnings release. In that report, analysts expect MMM to post earnings of $2.19 per share. This would mark a year-over-year decline of 15.12%.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.30 per share and revenue of $31.69 billion. These totals would mark changes of -8.79% and -1.38%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for MMM. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.62% higher within the past month. MMM currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, MMM is holding a Forward P/E ratio of 20.06. Its industry sports an average Forward P/E of 18.78, so we one might conclude that MMM is trading at a premium comparatively.

It is also worth noting that MMM currently has a PEG ratio of 2.11. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Diversified Operations was holding an average PEG ratio of 2.67 at yesterday's closing price.

The Diversified Operations industry is part of the Conglomerates sector. This industry currently has a Zacks Industry Rank of 112, which puts it in the top 45% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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Zacks Investment Research