Industrial conglomerate 3M (NYSE: MMM) will be reporting earnings tomorrow before market open. Here’s what investors should know.
3M beat analysts’ revenue expectations by 4.5% last quarter, reporting revenues of $6.01 billion, flat year on year. It was a satisfactory quarter for the company, with a decent beat of analysts’ EPS estimates.
Is 3M a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting 3M’s revenue to decline 28.8% year on year to $5.70 billion, a deceleration from its flat revenue in the same quarter last year. Adjusted earnings are expected to come in at $1.77 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. 3M has missed Wall Street’s revenue estimates three times over the last two years.
Looking at 3M’s peers in the industrial machinery segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Worthington’s revenues decreased 3.9% year on year, beating analysts’ expectations by 6.7%, and Snap-on reported a revenue decline of 3%, falling short of estimates by 4.1%. Worthington traded up 24% following the results.
Read our full analysis of Worthington’s results here and Snap-on’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the industrial machinery stocks have shown solid performance, the group has generally underperformed, with share prices down 10.5% on average over the last month. 3M is down 15.3% during the same time and is heading into earnings with an average analyst price target of $149.57 (compared to the current share price of $130.21).
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