We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
3M (MMM) Q1 Earnings & Revenues Surpass Estimates, Up Y/Y
Read MoreHide Full Article
3M Company (MMM - Free Report) reported first-quarter 2024 results, wherein revenues and earnings surpassed the Zacks Consensus Estimate. Both the top and bottom lines (on adjusted basis) increased on a year-over-year basis.
Inside the Headlines
3M delivered adjusted earnings of $2.39 per share, surpassing the Zacks Consensus Estimate of $2.08. The metric increased from $1.97 reported in the year-ago quarter.
The company’s adjusted net sales of $7.72 billion outperformed the Zacks Consensus Estimate of $7.64 billion. The metric increased 0.5% year over year, driven by organic sales growth of 0.8%. Foreign currency translation had a negative impact of 0.6%, while acquisitions boosted the top line by 0.3%. On a GAAP basis, MMM’s net sales inched down 0.3% year over year to $8.0 billion.
Region-wise, organic sales in the Americas declined 0.9% year over year, while that in the Asia Pacific inched up 2.6%. Organic sales from businesses in Europe, the Middle East and Africa increased 3.3%.
Segmental Results
In April 2024, 3M completed the spin off its Health Care business into a separate public company. Notably, the company’s first-quarter results include the performance of Health Care unit, as the spin-off was completed after first-quarter-end.
Revenues from Safety and Industrial totaled $2.73 billion, decreasing 1.7% year over year. This was caused by a 1.4% decrease in organic revenues and negative impact of 0.3% from foreign currency translation.
Revenues from Transportation & Electronics totaled $1.82 billion, reflecting a year-over-year increase of 6.9%. The increase is attributable to a 6.7% improvement in organic sales. Acquisitions boosted segmental revenues by 1.7%, while foreign currency translation had a 1.5% negative impact.
Revenues from Health Care were $2.02 billion, up 0.3% year over year. This were driven by organic sales increase of 1%. Divestitures and foreign currency translation had negative impacts of 0.3% and 0.4%, respectively.
Revenues from the Consumer segment fell 4.3% year over year to $1.14 billion. Organic sales decreased 3.9%. Movements in foreign currencies had an adverse impact of 0.4%.
In the quarter under review, 3M’s cost of sales decreased 6.2% year over year to $4.33 billion. Selling, general and administrative expenses increased 1.8% to $1.74 billion. Research, development and related expenses decreased 7.4% year over year to $437 million.
In the first quarter, 3M reported operating income of $1.50 billion compared with $1.24 billion in the year-ago period. The upside was driven by a decline in the company’s total operational expenses.
MMM’s adjusted operating income in the quarter ascended 23.7% year over year to $1.71 billion. The adjusted operating margin was 21.9% compared with 17.9% in the year-ago quarter. The adjusted tax rate in the quarter was 20.5% compared with 17.7% in the year-ago period.
Balance Sheet and Cash Flow
Exiting the first quarter, 3M had cash and cash equivalents of $10.9 billion compared with $5.9 billion at the end of December 2023. Long-term debt was $20.6 billion at the end of the reported quarter compared with $13.1 billion at the end of December 2023.
In the quarter, 3M generated net cash of $767 million from its operating activities, reflecting a decrease of 39.8% from the year-ago quarter. Capital used for purchasing property, plant and equipment decreased 21.1% to $375 million in the quarter.
Adjusted free cash flow at the end of the first quarter was $833 million, down 11.9% year over year. Adjusted free cash flow conversion was 63% at the end of the same period.
In the first three months of 2024, 3M rewarded its shareholders with $835 million in dividend payments.
2024 Guidance
MMM expects adjusted earnings in the range of $6.80-$7.30 per share. The mid-point of the guided range is $7.05, which reflects a decline from $9.24 reported in 2023.
Adjusted total sales are expected to decline 0.25% to increase 1.75%. This implies an adjusted organic sales growth of 0-2%.
3M expects its dividend payout ratio to be approximately 40% of adjusted free cash flow.
Zacks Rank & Key Picks
MMM currently carries a Zacks Rank #3 (Hold). Some better-ranked companies are discussed below:
The Zacks Consensus Estimate for CSL’s 2024 earnings has increased 5.8% in the past 60 days.
Ingersoll Rand plc (IR - Free Report) currently carries a Zacks Rank of 2 (Buy). IR delivered a trailing four-quarter average earnings surprise of 15.9%.
In the past 60 days, the Zacks Consensus Estimate for Ingersoll Rand’s 2024 earnings has increased 1.6%.
Federal Signal (FSS - Free Report) presently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 10.3%.
In the past 60 days, the Zacks Consensus Estimate for FSS’ 2024 earnings has increased 1.4%.
See More Zacks Research for These Tickers
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
3M (MMM) Q1 Earnings & Revenues Surpass Estimates, Up Y/Y
3M Company (MMM - Free Report) reported first-quarter 2024 results, wherein revenues and earnings surpassed the Zacks Consensus Estimate. Both the top and bottom lines (on adjusted basis) increased on a year-over-year basis.
Inside the Headlines
3M delivered adjusted earnings of $2.39 per share, surpassing the Zacks Consensus Estimate of $2.08. The metric increased from $1.97 reported in the year-ago quarter.
The company’s adjusted net sales of $7.72 billion outperformed the Zacks Consensus Estimate of $7.64 billion. The metric increased 0.5% year over year, driven by organic sales growth of 0.8%. Foreign currency translation had a negative impact of 0.6%, while acquisitions boosted the top line by 0.3%. On a GAAP basis, MMM’s net sales inched down 0.3% year over year to $8.0 billion.
Region-wise, organic sales in the Americas declined 0.9% year over year, while that in the Asia Pacific inched up 2.6%. Organic sales from businesses in Europe, the Middle East and Africa increased 3.3%.
Segmental Results
In April 2024, 3M completed the spin off its Health Care business into a separate public company. Notably, the company’s first-quarter results include the performance of Health Care unit, as the spin-off was completed after first-quarter-end.
Revenues from Safety and Industrial totaled $2.73 billion, decreasing 1.7% year over year. This was caused by a 1.4% decrease in organic revenues and negative impact of 0.3% from foreign currency translation.
Revenues from Transportation & Electronics totaled $1.82 billion, reflecting a year-over-year increase of 6.9%. The increase is attributable to a 6.7% improvement in organic sales. Acquisitions boosted segmental revenues by 1.7%, while foreign currency translation had a 1.5% negative impact.
Revenues from Health Care were $2.02 billion, up 0.3% year over year. This were driven by organic sales increase of 1%. Divestitures and foreign currency translation had negative impacts of 0.3% and 0.4%, respectively.
Revenues from the Consumer segment fell 4.3% year over year to $1.14 billion. Organic sales decreased 3.9%. Movements in foreign currencies had an adverse impact of 0.4%.
3M Company Price, Consensus and EPS Surprise
3M Company price-consensus-eps-surprise-chart | 3M Company Quote
Margin Profile
In the quarter under review, 3M’s cost of sales decreased 6.2% year over year to $4.33 billion. Selling, general and administrative expenses increased 1.8% to $1.74 billion. Research, development and related expenses decreased 7.4% year over year to $437 million.
In the first quarter, 3M reported operating income of $1.50 billion compared with $1.24 billion in the year-ago period. The upside was driven by a decline in the company’s total operational expenses.
MMM’s adjusted operating income in the quarter ascended 23.7% year over year to $1.71 billion. The adjusted operating margin was 21.9% compared with 17.9% in the year-ago quarter. The adjusted tax rate in the quarter was 20.5% compared with 17.7% in the year-ago period.
Balance Sheet and Cash Flow
Exiting the first quarter, 3M had cash and cash equivalents of $10.9 billion compared with $5.9 billion at the end of December 2023. Long-term debt was $20.6 billion at the end of the reported quarter compared with $13.1 billion at the end of December 2023.
In the quarter, 3M generated net cash of $767 million from its operating activities, reflecting a decrease of 39.8% from the year-ago quarter. Capital used for purchasing property, plant and equipment decreased 21.1% to $375 million in the quarter.
Adjusted free cash flow at the end of the first quarter was $833 million, down 11.9% year over year. Adjusted free cash flow conversion was 63% at the end of the same period.
In the first three months of 2024, 3M rewarded its shareholders with $835 million in dividend payments.
2024 Guidance
MMM expects adjusted earnings in the range of $6.80-$7.30 per share. The mid-point of the guided range is $7.05, which reflects a decline from $9.24 reported in 2023.
Adjusted total sales are expected to decline 0.25% to increase 1.75%. This implies an adjusted organic sales growth of 0-2%.
3M expects its dividend payout ratio to be approximately 40% of adjusted free cash flow.
Zacks Rank & Key Picks
MMM currently carries a Zacks Rank #3 (Hold). Some better-ranked companies are discussed below:
Carlisle Companies Incorporated (CSL - Free Report) presently sports a Zacks Rank #1 (Strong Buy). It has a trailing four-quarter average earnings surprise of 17%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CSL’s 2024 earnings has increased 5.8% in the past 60 days.
Ingersoll Rand plc (IR - Free Report) currently carries a Zacks Rank of 2 (Buy). IR delivered a trailing four-quarter average earnings surprise of 15.9%.
In the past 60 days, the Zacks Consensus Estimate for Ingersoll Rand’s 2024 earnings has increased 1.6%.
Federal Signal (FSS - Free Report) presently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 10.3%.
In the past 60 days, the Zacks Consensus Estimate for FSS’ 2024 earnings has increased 1.4%.