3M CO (MMM) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MMM - US88579Y1010 - Common Stock
155.72 USD
-2.33 (-1.47%)
Taking everything into account, MMM scores 5 out of 10 in our fundamental rating. MMM was compared to 7 industry peers in the Industrial Conglomerates industry. While MMM belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. MMM is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year MMM was profitable.
- In the past year MMM had a positive cash flow from operations.
- Of the past 5 years MMM 4 years were profitable.
- In the past 5 years MMM always reported a positive cash flow from operatings.
1.2 Ratios
- MMM's Return On Assets of 8.61% is amongst the best of the industry. MMM outperforms 100.00% of its industry peers.
- With an excellent Return On Equity value of 68.46%, MMM belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- The Return On Invested Capital of MMM (13.64%) is better than 100.00% of its industry peers.
- MMM had an Average Return On Invested Capital over the past 3 years of 12.18%. This is above the industry average of 7.65%.
- The last Return On Invested Capital (13.64%) for MMM is above the 3 year average (12.18%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.61% | ||
| ROE | 68.46% | ||
| ROIC | 13.64% |
ROA(3y)1.75%
ROA(5y)6.05%
ROE(3y)10.52%
ROE(5y)22.03%
ROIC(3y)12.18%
ROIC(5y)11.3%
1.3 Margins
- MMM has a Profit Margin of 13.03%. This is amongst the best in the industry. MMM outperforms 85.71% of its industry peers.
- MMM's Profit Margin has declined in the last couple of years.
- The Operating Margin of MMM (19.29%) is better than 85.71% of its industry peers.
- MMM's Operating Margin has declined in the last couple of years.
- MMM's Gross Margin of 39.91% is amongst the best of the industry. MMM outperforms 100.00% of its industry peers.
- In the last couple of years the Gross Margin of MMM has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.29% | ||
| PM (TTM) | 13.03% | ||
| GM | 39.92% |
OM growth 3Y36.93%
OM growth 5Y-2.37%
PM growth 3Y-16.13%
PM growth 5Y-5.11%
GM growth 3Y0.43%
GM growth 5Y-3.86%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), MMM is creating some value.
- Compared to 1 year ago, MMM has less shares outstanding
- MMM has less shares outstanding than it did 5 years ago.
- MMM has a worse debt/assets ratio than last year.
2.2 Solvency
- MMM has a debt to FCF ratio of 9.33. This is a negative value and a sign of low solvency as MMM would need 9.33 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 9.33, MMM belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
- MMM has a Debt/Equity ratio of 2.30. This is a high value indicating a heavy dependency on external financing.
- MMM has a Debt to Equity ratio (2.30) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.3 | ||
| Debt/FCF | 9.33 | ||
| Altman-Z | N/A |
ROIC/WACC1.66
WACC8.21%
2.3 Liquidity
- MMM has a Current Ratio of 1.71. This is a normal value and indicates that MMM is financially healthy and should not expect problems in meeting its short term obligations.
- MMM has a Current ratio of 1.71. This is amongst the best in the industry. MMM outperforms 85.71% of its industry peers.
- MMM has a Quick Ratio of 1.33. This is a normal value and indicates that MMM is financially healthy and should not expect problems in meeting its short term obligations.
- The Quick ratio of MMM (1.33) is better than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.71 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
- MMM shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.00%.
- MMM shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -1.63% yearly.
- The Revenue has been growing slightly by 1.52% in the past year.
- Measured over the past years, MMM shows a decrease in Revenue. The Revenue has been decreasing by -4.97% on average per year.
EPS 1Y (TTM)1%
EPS 3Y-7.24%
EPS 5Y-1.63%
EPS Q2Q%8.93%
Revenue 1Y (TTM)1.52%
Revenue growth 3Y-1.57%
Revenue growth 5Y-4.97%
Sales Q2Q%3.7%
3.2 Future
- MMM is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.78% yearly.
- MMM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.91% yearly.
EPS Next Y7.89%
EPS Next 2Y8.05%
EPS Next 3Y7.7%
EPS Next 5Y5.78%
Revenue Next Year3.49%
Revenue Next 2Y3.29%
Revenue Next 3Y3.04%
Revenue Next 5Y3.91%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 19.32, MMM is valued on the expensive side.
- Based on the Price/Earnings ratio, MMM is valued cheaper than 100.00% of the companies in the same industry.
- When comparing the Price/Earnings ratio of MMM to the average of the S&P500 Index (28.82), we can say MMM is valued slightly cheaper.
- Based on the Price/Forward Earnings ratio of 17.91, the valuation of MMM can be described as rather expensive.
- Based on the Price/Forward Earnings ratio, MMM is valued a bit cheaper than 71.43% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of MMM to the average of the S&P500 Index (25.95), we can say MMM is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.32 | ||
| Fwd PE | 17.91 |
4.2 Price Multiples
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of MMM indicates a somewhat cheap valuation: MMM is cheaper than 71.43% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.28 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates MMM does not grow enough to justify the current Price/Earnings ratio.
- The excellent profitability rating of MMM may justify a higher PE ratio.
PEG (NY)2.45
PEG (5Y)N/A
EPS Next 2Y8.05%
EPS Next 3Y7.7%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.83%, MMM has a reasonable but not impressive dividend return.
- MMM's Dividend Yield is a higher than the industry average which is at 4.46.
- Compared to an average S&P500 Dividend Yield of 1.82, MMM has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
5.2 History
- The dividend of MMM decreases each year by -8.82%.
- MMM has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-8.82%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DP0%
EPS Next 2Y8.05%
EPS Next 3Y7.7%
3M CO / MMM FAQ
What is the ChartMill fundamental rating of 3M CO (MMM) stock?
ChartMill assigns a fundamental rating of 5 / 10 to MMM.
What is the valuation status of 3M CO (MMM) stock?
ChartMill assigns a valuation rating of 4 / 10 to 3M CO (MMM). This can be considered as Fairly Valued.
Can you provide the profitability details for 3M CO?
3M CO (MMM) has a profitability rating of 8 / 10.
What is the valuation of 3M CO based on its PE and PB ratios?
The Price/Earnings (PE) ratio for 3M CO (MMM) is 19.32 and the Price/Book (PB) ratio is 17.43.
What is the expected EPS growth for 3M CO (MMM) stock?
The Earnings per Share (EPS) of 3M CO (MMM) is expected to grow by 7.89% in the next year.