3M (MMM) Gains As Market Dips: What You Should Know
3M (MMM) closed the most recent trading day at $168.40, moving +1.06% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.66%. Meanwhile, the Dow lost 0.58%, and the Nasdaq, a tech-heavy index, lost 0.8%.
Coming into today, shares of the maker of Post-it notes, industrial coatings and ceramics had gained 0.04% in the past month. In that same time, the Conglomerates sector gained 6.42%, while the S&P 500 gained 5.22%.
Wall Street will be looking for positivity from MMM as it approaches its next earnings report date. This is expected to be October 27, 2020. In that report, analysts expect MMM to post earnings of $2.25 per share. This would mark a year-over-year decline of 12.79%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.46 billion, up 5.92% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.37 per share and revenue of $31.88 billion. These totals would mark changes of -8.02% and -0.81%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for MMM. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.45% higher within the past month. MMM is currently a Zacks Rank #2 (Buy).
Investors should also note MMM's current valuation metrics, including its Forward P/E ratio of 19.91. Its industry sports an average Forward P/E of 19.13, so we one might conclude that MMM is trading at a premium comparatively.
Meanwhile, MMM's PEG ratio is currently 2.1. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Diversified Operations stocks are, on average, holding a PEG ratio of 2.66 based on yesterday's closing prices.
The Diversified Operations industry is part of the Conglomerates sector. This group has a Zacks Industry Rank of 91, putting it in the top 36% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.