3M is a dividend king with over 100 years of history and 60-year dividend growth. At the end of the first quarter, the corporation enjoyed one of its strongest neighborhoods. However, the geopolitical and legal nature of the company presents enormous concerns. 3M is a complete all-weather inventory.
The worldwide corporation sells around 60,000 different products and can adapt to changes in the market. Over the years, 3M has faced lawsuits, in part due to the nature of its products. It generates about half of its revenue in Asia, and especially in China, where it grows the fastest. Over the next five years, the company will return a respectable
3M: SWAN Industrial Play
3M Company (MMM) has long-term records of good investor returns. The company manufactures and sells new products in strategic end markets. 3M creates substantial financial resources and provides shareholders with an increasing dividend on a percentage of their money earned. Its return on invested money is regularly high, a long-term measure of its pricing power. Over the years, 3M has demonstrated a remarkable ability to ‘boost’ its product portfolio with growing, high-demand end markets.
3M is expected to increase total organic sales this year by 3-6%. The company’s dividend has grown to 6.69% over the past five years, and the payout rate remains properly controlled at just 47.8%. 3M’s actions may respond positively to any clarification regarding either of its two processes. Investors can often push too hard to get the next big investment, if just “what works” can be a rewarding long-term strategy. Dividend investors with a 3M company in a portfolio can sleep soundly through the night. The company continues to flourish and its solid foundations speak to continued shareholder returns.
Dividend Sleuthing: 3M
The 3M Company (MMM) was founded in 1902 as a multinational corporation. It has sold 60,000 products in a wide variety of customer end markets. Almost 50% of the revenue comes from outside America. For over 100 years, the corporation has paid dividends continuously and has increased payouts for 63 consecutive years. 3M’s share price fell in 2018 due to trade and environmental lawsuits between China and the United States.
CEO Mike Roman has four priorities: maximizing his portfolio; innovate; to transform; and for people and culture. The company is striving to be a leader in ESG with commitments on carbon emissions, water consumption and water quality improvements. MMM is 5.0 percent of my 20-stock pension income portfolio. The company’s long-term business prospects include infrastructure growth, electronics technology and healthcare.
The MMM “Quant” score is an objective assessment. For example, the quantum score of MMM is 3.31. The company’s long-term debt is 52.99% of total equity, so it gets a score of 100% or 47.00% and then multiplies by 10 which gives MMM a score of 4.70. The dividend safety score of 75 is 7.5, with an average of 50.
How much is 3M worth?
3M (MMM) is the King of Dividends, with a solid business model and balance sheet that, in an era of record low rates, also offers a comparatively reasonable return of 2.9%. In the face of inflationary pressures, the corporation actively invests to retain its price power and market position. In recent years, MMM’s dividend growth has slowed dramatically. Over the next five years, the corporation is expected to increase its share of earnings by dilution by 5% to 6% per year.
It trades based on P/L and EV/EBITDA for a small premium up to a five-year average of 20.8x. However, stock movements are in line with their historical averages, due to the temporary stock market crash after the COVID-19 outbreak. Its 2.9% yield plus 5% anticipated annualized dividend increase combine 8% total annualized returns.
3M: Attractive valuation with advantage
Over the past five years, 3M (MMM) has been outperformed by the broader S&P 500 by about 4x. According to Jeff Kagan, the company is undervalued for its stability and momentum. 3M earns 49% gross margins compared to 37% among its co-workers, is flexible and can move into other high-growth areas. It creates a high free cash flow conversion with a minimum income of 4.7%, allowing it to be scaled up and down as the economy dictates. 3M’s fundamentals are good, but it’s hard to find value in today’s market.
At $1.4 billion, free cash flow increased by 49% and over 85%, and dividends increased again. In my DCF analysis, there was a realistic 5% CAGR growth and an expansion of the EBIT margin to 23% by 2025. The worst-case scenario, with a 12 times margin and 3% growth over nominal GDP growth, is only 14% negative. 3M may have its perils, but it’s a great income investment with significant advantages in today’s marketplace. All four companies produce robust growth that flows into the upper single digits.
The corporation has R&D expenses of about $2 billion, 85% of which is spent on companies connecting technology. This optional level makes 3M a strong long-term investment.
MMM 3M Company – Equities
MMM is a diversified global metals and mining company headquartered in Moscow, Russia. The MMM Group’s business portfolio includes mining, engineering and trading in non-ferrous and ferrous metals, coal, oil and gas, power generation, as well as financial services.
MMM Group – Introduction
MMM, formerly known as MMM Metals and Mining, has grown steadily since 2004. The company generates around 60% of its sales in Russia, 10% in Belarus and another 10% in China and the rest of Eurasia. Management says the company continues to grow and invests in new facilities and sales promotions to expand its business in Russia and the rest of Eurasia. MMM opened a new mine in Peski, Russia in September 2017. It also plans to start a new mine in Pokrovskoye, Russia, in the third quarter of 2017, with a diversified portfolio of metals and minerals, with no metals or minerals having more than 20% of its sales and operates in a low-tax environment as it has no US or EU stakes.
Investment Activities
The MMM Group is developing global investment products and solutions and has been building MMM Funds, a multi-asset investment manager, since 1997. MMM Funds (formerly Dolgopolovrains) comprises more than 10 funds, including open-end funds, open-end balanced funds , closed-end funds, closed-end equity funds and real estate funds. The MMM Group focuses on building a closed fund for its investment operations and a mutual fund for its operations. Grupo MMM believes that it is its job to be the solution for those who want to invest, save and not invest.
