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3M (MMM) Dips More Than Broader Markets: What You Should Know

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3M (MMM - Free Report) closed the most recent trading day at $146.37, moving -1.96% from the previous trading session. This change lagged the S&P 500's daily loss of 0.75%. At the same time, the Dow lost 0.54%, and the tech-heavy Nasdaq gained 0.24%.

Coming into today, shares of the maker of Post-it notes, industrial coatings and ceramics had gained 0.82% in the past month. In that same time, the Conglomerates sector gained 3.58%, while the S&P 500 gained 0.32%.

Investors will be hoping for strength from 3M as it approaches its next earnings release. The company is expected to report EPS of $2.61, up 0.77% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.85 billion, down 1.13% from the year-ago period.

MMM's full-year Zacks Consensus Estimates are calling for earnings of $10.85 per share and revenue of $35.93 billion. These results would represent year-over-year changes of +7.21% and +1.62%, respectively.

Investors should also note any recent changes to analyst estimates for 3M. 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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. Within the past 30 days, our consensus EPS projection remained stagnant. 3M currently has a Zacks Rank of #2 (Buy).

Looking at its valuation, 3M is holding a Forward P/E ratio of 13.76. This represents a discount compared to its industry's average Forward P/E of 15.56.

Investors should also note that MMM has a PEG ratio of 1.45 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Diversified Operations stocks are, on average, holding a PEG ratio of 1.3 based on yesterday's closing prices.

The Diversified Operations industry is part of the Conglomerates sector. This group has a Zacks Industry Rank of 87, putting it in the top 35% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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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