MMM - Embedded Expectations Analysis - 2019 12 09
3M Company (MMM:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with a 20.8x Uniform P/E. At these levels, markets have bullish expectations for the firm, but management may be concerned about their investments, growth, and FX.Specifically, management may be concerned about the return on their investments into innovation, and they may lack confidence in their ability to further expand globally. Furthermore, they may lack confidence in their ability to improve their inventory management efficiency and realize positive organic growth in their industrial segment. In addition, they may be concerned about the sustainability of recent growth in their home improvement segment, and they may be downplaying the impact of FX on their profitability. Finally, they may be concerned about increases to interest expense in Q4, and they may lack confidence in their ability to meet their Q4 non-GAAP EPS guidance.
3M is a technology company. The company has four segments: Safety and Industrial, which consists of personal safety, industrial adhesives and tapes, abrasives, closure and masking systems, electrical markets, automotive aftermarket, and roofing granules; Transportation and Electronics, which consists of electronics, automotive and aerospace, commercial solutions, advanced materials, and transportation safety; Health Care, which includes medical solutions, oral care, separation and purification sciences, health information systems, drug delivery systems, and food safety; and Consumer, which consists of home improvement, stationery and office supplies, home care, and consumer health care.
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