3M CO (MMM) Stock Fundamental Analysis
NYSE:MMM - New York Stock Exchange, Inc. - US88579Y1010 - Common Stock - Currency: USD
MMM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 6 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 positive operating cash flow in the past year.
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 has a Return On Assets of 10.92%. This is amongst the best in the industry. MMM outperforms 100.00% of its industry peers.
Looking at the Return On Equity, with a value of 97.69%, MMM belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
MMM has a better Return On Invested Capital (13.70%) than 100.00% of its industry peers.
MMM had an Average Return On Invested Capital over the past 3 years of 11.12%. This is above the industry average of 8.04%.
The last Return On Invested Capital (13.70%) for MMM is above the 3 year average (11.12%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.92% | ||
| ROE | 97.69% | ||
| ROIC | 13.7% |
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 better Profit Margin (17.79%) than 100.00% of its industry peers.
MMM's Profit Margin has improved in the last couple of years.
MMM's Operating Margin of 20.46% is amongst the best of the industry. MMM outperforms 83.33% of its industry peers.
MMM's Operating Margin has been stable in the last couple of years.
MMM has a Gross Margin of 41.21%. This is amongst the best in 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 | 20.46% | ||
| PM (TTM) | 17.79% | ||
| GM | 41.21% |
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
MMM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for MMM has been reduced compared to 1 year ago.
The number of shares outstanding for MMM has been reduced compared to 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 3.89. This indicates that MMM is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of MMM (3.89) is better than 100.00% of its industry peers.
MMM has a Debt/Equity ratio of 2.76. This is a high value indicating a heavy dependency on external financing.
With a decent Debt to Equity ratio value of 2.76, MMM is doing good in the industry, outperforming 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.76 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.89 |
ROIC/WACC1.67
WACC8.2%
2.3 Liquidity
MMM has a Current Ratio of 1.66. 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 better Current ratio (1.66) than 83.33% of its industry peers.
MMM has a Quick Ratio of 1.25. 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 better Quick ratio (1.25) than 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.25 |
3. Growth
3.1 Past
MMM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -22.67%.
The Earnings Per Share has been decreasing by -2.72% on average over the past years.
The Revenue for MMM has decreased by -20.06% in the past year. This is quite bad
Measured over the past years, MMM shows a decrease in Revenue. The Revenue has been decreasing by -5.22% on average per year.
EPS 1Y (TTM)-22.67%
EPS 3Y-7.61%
EPS 5Y-2.72%
EPS Q2Q%-21.34%
Revenue 1Y (TTM)-20.06%
Revenue growth 3Y-11.42%
Revenue growth 5Y-5.22%
Sales Q2Q%-25.15%
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 5.41% on average per year.
Based on estimates for the next years, MMM will show a small growth in Revenue. The Revenue will grow by 4.21% on average per year.
EPS Next Y-3.18%
EPS Next 2Y2.52%
EPS Next 3Y4.97%
EPS Next 5Y5.41%
Revenue Next Year1.33%
Revenue Next 2Y2.11%
Revenue Next 3Y2.45%
Revenue Next 5Y4.21%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
MMM is valuated rather expensively with a Price/Earnings ratio of 19.76.
MMM's Price/Earnings ratio is rather cheap when compared to the industry. MMM is cheaper than 100.00% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 25.82. MMM is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 17.60, which indicates a rather expensive current valuation of MMM.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MMM indicates a rather cheap valuation: MMM is cheaper than 83.33% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.76. MMM is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.76 | ||
| Fwd PE | 17.6 |
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 66.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 13.84 |
4.3 Compensation for Growth
MMM has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y2.52%
EPS Next 3Y4.97%
5. Dividend
5.1 Amount
MMM has a Yearly Dividend Yield of 1.96%. Purely for dividend investing, there may be better candidates out there.
MMM's Dividend Yield is a higher than the industry average which is at 5.39.
Compared to an average S&P500 Dividend Yield of 2.36, MMM has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
5.2 History
The dividend of MMM decreases each year by -8.81%.
MMM has paid a dividend for at least 10 years, which is a reliable track record.
MMM has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-8.81%
Div Incr Years33
Div Non Decr Years33
5.3 Sustainability
35.38% of the earnings are spent on dividend by MMM. This is a low number and sustainable payout ratio.
DP35.38%
EPS Next 2Y2.52%
EPS Next 3Y4.97%
147.62
-2.16 (-1.44%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryIndustrial Conglomerates
Earnings (Last)
Earnings (Next)
Inst Owners69.27%
Inst Owner Change5.55%
Ins Owners0.04%
Ins Owner Change4.99%
Market Cap79.45B
Analysts75.65
Price Target152.56 (3.35%)
Short Float %1.83%
Short Ratio2.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.96% |
Yearly Dividend3.63
Dividend Growth(5Y)-8.81%
DP35.38%
Div Incr Years33
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.75%
Min EPS beat(2)0.09%
Max EPS beat(2)5.42%
EPS beat(4)4
Avg EPS beat(4)5.49%
Min EPS beat(4)0.09%
Max EPS beat(4)13.52%
EPS beat(8)8
Avg EPS beat(8)9.58%
EPS beat(12)11
Avg EPS beat(12)8.28%
EPS beat(16)15
Avg EPS beat(16)9.32%
Revenue beat(2)0
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-0.6%
Max Revenue beat(2)-0.51%
Revenue beat(4)1
Avg Revenue beat(4)-0.13%
Min Revenue beat(4)-0.8%
Max Revenue beat(4)1.4%
Revenue beat(8)3
Avg Revenue beat(8)-0.16%
Revenue beat(12)5
Avg Revenue beat(12)0.25%
Revenue beat(16)7
Avg Revenue beat(16)0.49%
PT rev (1m)-4.05%
PT rev (3m)-2.27%
EPS NQ rev (1m)-1.69%
EPS NQ rev (3m)-4.28%
EPS NY rev (1m)-1.35%
EPS NY rev (3m)-2.04%
Revenue NQ rev (1m)0.46%
Revenue NQ rev (3m)0.47%
Revenue NY rev (1m)0.47%
Revenue NY rev (3m)0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.76 | ||
| Fwd PE | 17.6 | ||
| P/S | 3.24 | ||
| P/FCF | N/A | ||
| P/OCF | 81.65 | ||
| P/B | 17.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.84 |
EPS(TTM)7.47
EY5.06%
EPS(NY)8.39
Fwd EY5.68%
FCF(TTM)-0.13
FCFYN/A
OCF(TTM)1.81
OCFY1.22%
SpS45.55
BVpS8.29
TBVpS-5.68
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.92% | ||
| ROE | 97.69% | ||
| ROCE | 16.45% | ||
| ROIC | 13.7% | ||
| ROICexc | 17.8% | ||
| ROICexgc | 26.19% | ||
| OM | 20.46% | ||
| PM (TTM) | 17.79% | ||
| GM | 41.21% | ||
| 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-Score7
Asset Turnover0.61
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.76 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.97 | ||
| Cap/Depr | 85.2% | ||
| Cap/Sales | 4.25% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 15.6% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.25 | ||
| Altman-Z | 3.89 |
F-Score7
WACC8.2%
ROIC/WACC1.67
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)-22.67%
EPS 3Y-7.61%
EPS 5Y-2.72%
EPS Q2Q%-21.34%
EPS Next Y-3.18%
EPS Next 2Y2.52%
EPS Next 3Y4.97%
EPS Next 5Y5.41%
Revenue 1Y (TTM)-20.06%
Revenue growth 3Y-11.42%
Revenue growth 5Y-5.22%
Sales Q2Q%-25.15%
Revenue Next Year1.33%
Revenue Next 2Y2.11%
Revenue Next 3Y2.45%
Revenue Next 5Y4.21%
EBIT growth 1Y-12.49%
EBIT growth 3Y-12.56%
EBIT growth 5Y-4.5%
EBIT Next Year34.75%
EBIT Next 3Y15.33%
EBIT Next 5Y7.34%
FCF growth 1Y-101.7%
FCF growth 3Y-52.23%
FCF growth 5Y-34.69%
OCF growth 1Y-83.38%
OCF growth 3Y-37.51%
OCF growth 5Y-23.78%