3M has long- and short-term trendlines working against it
When we last checked in with 3M Company (NYSE: MMM) the American conglomerate -- that has its hand in too many industries to count -- was in the midst of a healthcare spinoff. Now, three months later, MMM is on the verge of a nearly 10-year bottom. What gives?
Last seen at $108.64, 3M stock is down 39% in 2022, and a chip-shot from its Oct. 7 nine-year bottom of $107.08. A mid-August rally above $150 was turned away by the shares' 180-day moving average, while the shorter-term 20-day trendline has kept a lid on more recent rallies. However, 3M now offers a fair valuation at a forward price-earnings ratio of 10.00 and a price-sales ratio of 1.77. Moreover, it provides a very attractive dividend yield of 5.54% at a forward dividend of $5.96.
The business’s growth potential remains limited with estimates predicting a 1.5% decrease in revenue and a 2.2% increase in earnings for fiscal 2022. In addition, 3M is expected to report 1.7% revenue growth and 4.5% earnings growth for fiscal 2023, perhaps making the stock most suited as a long-term dividend play.