Diversified tech company 3M (MMM) is set to report its Q3 earnings results on October 21 before the market opens. Analysts are expecting earnings per share to come in at $2.07 on revenue of $6.25 billion. This compares to last year’s figures of $1.98 and $6.29 billion, respectively. Interestingly, 3M has a strong track record when it comes to beating earnings. In fact, it has done so in each of its last 10 quarters. However, analysts have mixed opinions on the stock.
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In fact, several major banks recently updated their expectations for 3M ahead of the earnings report. To begin with, five-star JPMorgan analyst Stephen Tusa raised his price target slightly from $175 to $178 and kept his Buy rating. While the firm is cautious in the short term about the electrical equipment and multi-industry sector, it believes that 3M’s current valuation looks more appealing. As a result, JPMorgan is leaning toward stocks like 3M that offer value but aren’t currently popular with most investors.
Citi’s five-star Andrew Kaplowitz also bumped his price target for 3M up to $169 from $160 but, unlike JPMorgan, he maintained a Hold rating. This is because although Citi expects demand from data centers to be strong, demand in other areas may be mixed. However, RBC Capital, led by five-star-rated Deane Dray, was much more pessimistic about 3M with a $120 price target and a Sell rating. Interestingly, RBC says that long-term themes like reshoring, electrification, and AI should support solid growth. Nevertheless, the firm still sees weakness in areas like residential construction, HVAC, and chemicals.
What Do Options Traders Anticipate?
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. Indeed, the at-the-money straddle suggests that options traders expect a 5.85% price move in either direction. This estimate is derived from the $155 strike price, with call options priced at $4.60 and put options at $4.47.
Is MMM Stock a Buy?
Overall, analysts have a Moderate Buy consensus rating on MMM stock based on five Buy, two Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average MMM price target of $161.88 per share implies that shares are close to fair value. At the same time, TipRanks’ AI analyst has Neutral rating and a $152 per share price target.
