TLDR
- 3M reported Q3 earnings of $2.50 a share on $6.6 billion in sales, ahead of the $2.38 estimate.
- Full-year guidance rose to $9.10 to $9.15 a share from $8.80 to $8.95.
- Amazon received warrants to buy 3.2 million of 3Mās stock, which vest after $6 billion in data center spending.
- The stock rose 1.9% to $165 early, then turned lower to about $162.
- Analysts hold a consensus Hold rating with an average price target of $181.71.
3M (MMM) stock traded near $162 on Tuesday after the company beat third-quarter estimates and raised its outlook. Early on, the stock was up 1.9% at $165 before it turned lower.
MarketBeat data showed the stock opening at $162.11 and trading down about 2% on the day. The early gain did not hold.
3M reported earnings of $2.50 a share on sales of $6.6 billion. Wall Street was looking for $2.38 a share on the same sales level.
A year ago, 3M earned $2.19 a share on sales of $6.2 billion. Sales are up from $6.2 billion in that quarter.
Full-year earnings guidance moved up to a range of $9.10 to $9.15 a share. The prior range was $8.80 to $8.95.
The Amazon Deal
On Monday, 3M announced an expanded strategic commercial relationship with a wholly owned Amazon subsidiary. Amazon ended up with warrants to buy 3.2 million of 3Mās stock.
The warrants vest after Amazon spends $6 billion on optical connectivity and other data center products. 3M is also working with Genius Electronic Optical on expanded beam optics, a fiber optic connection technology.
Fiber optics carry most of the data between server racks in AI data centers. Barronās wrote that this makes 3M a data center supplier, and that idea may have helped the early move.
Coming into Tuesday, 3M stock had gained just 1% this year and 5% over the past 12 months. It trades at about 17 times expected earnings, down from almost 20 a year ago.
Valuation and Analyst Views
MarketBeat lists a 52-week range of $139.34 to $184.90. The market cap is $83.60 billion.
The 50-day moving average is $169.59 and the 200-day is $161.52. The stock sits below the first and just above the second.
Seven analysts rate the stock Buy, seven rate it Hold and one rates it Sell. The average price target is $181.71.
UBS raised its target to $218 from $190 with a Buy rating in July. Wells Fargo started coverage in September with an equal weight rating and a $195 target.
Bernstein upgraded the stock to market perform in September and lifted its target to $171 from $145. Mizuho raised its target to $180 from $160 with a neutral rating.
Insider Karin Chavez sold 3,635 units of stock at an average of $182.51 in August, about $663,424 in total. She still owns 14,035 after the sale.
3M kept its quarterly dividend at $0.78, a 1.9% yield. The latest quote shows the stock down about 2% near $162 on Tuesday.
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