Blue-Chip Consumer Goods Stock Could See Tailwinds

Long-term trendlines are moving higher for the first time in three years

Jul 12, 2024 at 11:06 AM

Subscribers to Schaeffer's Weekend Trader options recommendation service received this MMM commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters. Learn more about why Weekend Trader is one of our most popular options trading services.

After hitting a May 20, 52-week high, consumer goods stock 3M Co (NYSE:MMM) pulled back to its 20-day moving average and $100 century mark. Buying followed a bullish post-earnings reaction in early May, even as retail clients at major brokerages were net sellers during the month. Since then, MMM took out its 2020 low at $97 and later retested that level.

Only four of 12 analysts in coverage rate the equity a "buy." This leaves plenty of room for upgrades as MMM’s technical backdrop improves, especially considering key long-term trendlines are moving higher for the first time in three years.

Our recommended November call has a leverage ratio of 7.8, and will double on a 13.9% rise in the underlying security.

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