Litigation And Economic Cycles Dominate The 3M Discussion, But There Are Longer-Term Growth Issues To Consider


  • 3M posted poor results for the third quarter, even relative to low expectations, as the company showed below-average pricing leverage and weak volumes.
  • Guidance reinforces 3M’s weak leverage vis-a-vis a short-cycle slowdown, with few significant growth drivers in the near term.
  • 3M has seen some hiccups in its litigation recently, but a comprehensive settlement is still the likely outcome for its earplug and PFAS litigation.
  • My biggest concern with 3M remains its lack of apparent willingness to embrace real change – while other multi-industrials have embraced new growth drivers, 3M has not.
  • 3M’s valuation is undemanding, and weak sentiment could set up a rebound in the coming quarters, but I’m finding it harder to believe in management’s long-term vision (or that there is one).

3M World Headquarters


There’s really not much positive to say about 3M (NYSE:MMM) since my last update on the company. Even against a backdrop of low expectations, the company has managed to come up short, with weaker-than-expected results in businesses tied to consumer

Disclosure: I/we have a beneficial long position in the shares of MMM either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Leave a Reply

Your email address will not be published. Required fields are marked *