3M CO (MMM) Stock Fundamental Analysis
USA - NYSE:MMM - US88579Y1010 - Common Stock
151.1 USD
+2.35 (+1.58%)
151.1 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to MMM. 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
MMM had positive earnings in the past year.
MMM had a negative operating cash flow in the past year.
MMM had positive earnings in 4 of the past 5 years.
MMM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 10.37%, MMM belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
MMM has a Return On Equity of 91.82%. This is amongst the best in the industry. MMM outperforms 100.00% of its industry peers.
The Return On Invested Capital of MMM (13.42%) is better than 100.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MMM is above the industry average of 8.05%.
The last Return On Invested Capital (13.42%) for MMM is above the 3 year average (11.12%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.37% | ||
| ROE | 91.82% | ||
| ROIC | 13.42% |
ROA(3y)3.02%
ROA(5y)6.63%
ROE(3y)0.78%
ROE(5y)16.81%
ROIC(3y)11.12%
ROIC(5y)12.9%
1.3 Margins
MMM has a Profit Margin of 16.01%. This is amongst the best in the industry. MMM outperforms 100.00% of its industry peers.
MMM's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 19.75%, MMM belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
MMM's Operating Margin has been stable in the last couple of years.
The Gross Margin of MMM (41.11%) is better than 100.00% of its industry peers.
MMM's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.75% | ||
| PM (TTM) | 16.01% | ||
| GM | 41.11% |
OM growth 3Y-1.29%
OM growth 5Y0.76%
PM growth 3Y0.46%
PM growth 5Y3.85%
GM growth 3Y-4.12%
GM growth 5Y-2.49%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so MMM is still creating some value.
Compared to 1 year ago, MMM has less shares outstanding
MMM has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, MMM has a worse debt to assets ratio.
2.2 Solvency
MMM has an Altman-Z score of 4.07. This indicates that MMM is financially healthy and has little risk of bankruptcy at the moment.
MMM's Altman-Z score of 4.07 is amongst the best of the industry. MMM outperforms 100.00% of its industry peers.
A Debt/Equity ratio of 2.91 is on the high side and indicates that MMM has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 2.91, MMM is in line with its industry, outperforming 57.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.91 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 4.07 |
ROIC/WACC1.72
WACC7.8%
2.3 Liquidity
MMM has a Current Ratio of 1.72. This is a normal value and indicates that MMM is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of MMM (1.72) is better than 85.71% of its industry peers.
A Quick Ratio of 1.20 indicates that MMM should not have too much problems paying its short term obligations.
The Quick ratio of MMM (1.20) is better than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.72 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
The earnings per share for MMM have decreased strongly by -18.26% in the last year.
Measured over the past years, MMM shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.72% on average per year.
Looking at the last year, MMM shows a very negative growth in Revenue. The Revenue has decreased by -13.97% in the last year.
MMM shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -5.22% yearly.
EPS 1Y (TTM)-18.26%
EPS 3Y-7.61%
EPS 5Y-2.72%
EPS Q2Q%11.92%
Revenue 1Y (TTM)-13.97%
Revenue growth 3Y-11.42%
Revenue growth 5Y-5.22%
Sales Q2Q%2.31%
3.2 Future
Based on estimates for the next years, MMM will show a small growth in Earnings Per Share. The EPS will grow by 4.70% on average per year.
Based on estimates for the next years, MMM will show a small growth in Revenue. The Revenue will grow by 3.73% on average per year.
EPS Next Y0.09%
EPS Next 2Y3.81%
EPS Next 3Y5.57%
EPS Next 5Y4.7%
Revenue Next Year2.47%
Revenue Next 2Y2.68%
Revenue Next 3Y2.81%
Revenue Next 5Y3.73%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.62, which indicates a rather expensive current valuation of MMM.
Based on the Price/Earnings ratio, MMM is valued cheaper than 100.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.34, MMM is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 17.57, the valuation of MMM can be described as rather expensive.
Based on the Price/Forward Earnings ratio, MMM is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of MMM to the average of the S&P500 Index (22.86), we can say MMM is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.62 | ||
| Fwd PE | 17.57 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA 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 | N/A | ||
| EV/EBITDA | 14.64 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of MMM may justify a higher PE ratio.
PEG (NY)212.39
PEG (5Y)N/A
EPS Next 2Y3.81%
EPS Next 3Y5.57%
5. Dividend
5.1 Amount
MMM has a Yearly Dividend Yield of 1.91%.
MMM's Dividend Yield is a higher than the industry average which is at 6.15.
Compared to the average S&P500 Dividend Yield of 2.44, MMM is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.91% |
5.2 History
The dividend of MMM decreases each year by -8.81%.
MMM has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-8.81%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
MMM pays out 39.27% of its income as dividend. This is a sustainable payout ratio.
DP39.27%
EPS Next 2Y3.81%
EPS Next 3Y5.57%
151.1
+2.35 (+1.58%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryIndustrial Conglomerates
Earnings (Last)
Earnings (Next)
Inst Owners75.88%
Inst Owner Change-0.12%
Ins Owners0.03%
Ins Owner Change0.86%
Market Cap80.48B
Analysts75
Price Target162.18 (7.33%)
Short Float %1.49%
Short Ratio2.53
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.91% |
Yearly Dividend3.63
Dividend Growth(5Y)-8.81%
DP39.27%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.8%
Min EPS beat(2)5.42%
Max EPS beat(2)6.18%
EPS beat(4)4
Avg EPS beat(4)3.66%
Min EPS beat(4)0.09%
Max EPS beat(4)6.18%
EPS beat(8)8
Avg EPS beat(8)7.24%
EPS beat(12)11
Avg EPS beat(12)8.66%
EPS beat(16)15
Avg EPS beat(16)8.93%
Revenue beat(2)0
Avg Revenue beat(2)-0.44%
Min Revenue beat(2)-0.6%
Max Revenue beat(2)-0.28%
Revenue beat(4)0
Avg Revenue beat(4)-0.55%
Min Revenue beat(4)-0.8%
Max Revenue beat(4)-0.28%
Revenue beat(8)2
Avg Revenue beat(8)-0.27%
Revenue beat(12)4
Avg Revenue beat(12)0.18%
Revenue beat(16)6
Avg Revenue beat(16)0.26%
PT rev (1m)0.04%
PT rev (3m)4.47%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2%
EPS NY rev (1m)0.02%
EPS NY rev (3m)2.98%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.36%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)0.99%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.62 | ||
| Fwd PE | 17.57 | ||
| P/S | 3.27 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 18.76 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.64 |
EPS(TTM)7.7
EY5.1%
EPS(NY)8.6
Fwd EY5.69%
FCF(TTM)-3.72
FCFYN/A
OCF(TTM)-1.88
OCFYN/A
SpS46.19
BVpS8.05
TBVpS-6.21
PEG (NY)212.39
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.37% | ||
| ROE | 91.82% | ||
| ROCE | 16.1% | ||
| ROIC | 13.42% | ||
| ROICexc | 15.59% | ||
| ROICexgc | 22.04% | ||
| OM | 19.75% | ||
| PM (TTM) | 16.01% | ||
| GM | 41.11% | ||
| FCFM | N/A |
ROA(3y)3.02%
ROA(5y)6.63%
ROE(3y)0.78%
ROE(5y)16.81%
ROIC(3y)11.12%
ROIC(5y)12.9%
ROICexc(3y)13.89%
ROICexc(5y)15.46%
ROICexgc(3y)26.14%
ROICexgc(5y)32.17%
ROCE(3y)13.54%
ROCE(5y)15.6%
ROICexcg growth 3Y-10.19%
ROICexcg growth 5Y-4.14%
ROICexc growth 3Y2.14%
ROICexc growth 5Y4.95%
OM growth 3Y-1.29%
OM growth 5Y0.76%
PM growth 3Y0.46%
PM growth 5Y3.85%
GM growth 3Y-4.12%
GM growth 5Y-2.49%
F-Score4
Asset Turnover0.65
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.91 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.05 | ||
| Cap/Depr | 80.94% | ||
| Cap/Sales | 3.99% | ||
| Interest Coverage | N/A | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.72 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 4.07 |
F-Score4
WACC7.8%
ROIC/WACC1.72
Cap/Depr(3y)87.82%
Cap/Depr(5y)85.14%
Cap/Sales(3y)5.49%
Cap/Sales(5y)5.14%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-18.26%
EPS 3Y-7.61%
EPS 5Y-2.72%
EPS Q2Q%11.92%
EPS Next Y0.09%
EPS Next 2Y3.81%
EPS Next 3Y5.57%
EPS Next 5Y4.7%
Revenue 1Y (TTM)-13.97%
Revenue growth 3Y-11.42%
Revenue growth 5Y-5.22%
Sales Q2Q%2.31%
Revenue Next Year2.47%
Revenue Next 2Y2.68%
Revenue Next 3Y2.81%
Revenue Next 5Y3.73%
EBIT growth 1Y-11.39%
EBIT growth 3Y-12.56%
EBIT growth 5Y-4.5%
EBIT Next Year34.71%
EBIT Next 3Y14.99%
EBIT Next 5Y9.76%
FCF growth 1Y-144.62%
FCF growth 3Y-52.23%
FCF growth 5Y-34.69%
OCF growth 1Y-116.06%
OCF growth 3Y-37.51%
OCF growth 5Y-23.78%