Key Stats for MMM Stock
- This-Month Performance: 4%
- 52-Week Range: $122 to $177
- Valuation Model Target Price: $172
- Implied Upside: 3.8%
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What Happened?
3M Company stock rose about 4% this month, finishing near $166 per share, as investors reacted to a quarterly earnings beat, accelerating margin expansion, and firm 2026 guidance.
The move reflects growing confidence that restructuring efforts and commercial execution are translating into durable earnings momentum.
Shares climbed after 3M reported fourth quarter EPS of $1.83, beating estimates of $1.80, on revenue of $6.13 billion versus $6.03 billion expected.
Organic sales grew 2.2%, operating margin reached 21.1%, and free cash flow conversion exceeded 130%.
For the full year, organic growth was 2.1%, adjusted operating margin expanded 200 basis points to 23.4%, and EPS rose 10% to $8.06.
Management guided 2026 EPS to $8.50 to $8.70 with approximately 3% organic sales growth, signaling continued operating leverage this year.
CEO Bill Brown said, “We delivered solid results in Q4,” highlighting strength in Safety and Industrial, electronics, and aerospace, alongside sustained order momentum and a higher ending backlog entering 2026.
Margin expansion was driven by $550 million of productivity and $200 million of volume growth, partially offset by tariff and stranded cost headwinds.
Institutional positioning reinforced the constructive tone. Inspire Trust Co. N.A. increased its stake by 21.9% to 39,000 shares worth about $6.05 million, while L & S Advisors raised its position by 32.2% to 58,316 shares valued near $9.05 million.
Rhumbline Advisers continues to hold over 1.09 million shares worth roughly $170 million despite trimming slightly, and institutional investors collectively own about 65% of 3M.
While Wedbush Securities reduced its stake by 32.2% and 3M’s Chief Accounting Officer sold 5,145 shares at $172.75 on February 11, ownership trends still reflect broad professional participation following the earnings beat.
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Is MMM Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 3.3%
- Operating Margins: 25.1%
- Exit P/E Multiple: 16x
Revenue is projected to stabilize after falling to roughly $24 billion in 2024, with estimates pointing toward the $25 billion to $28 billion range over the next several years as pricing discipline, portfolio optimization, and end-market normalization continue.
Margin expansion remains the central earnings driver. Trailing twelve-month EBIT margin stands near 18.9%, while the model assumes improvement toward 25.1%, reflecting restructuring actions, improved manufacturing efficiency, and stronger mix in higher-margin businesses such as Safety and Industrial and Transportation and Electronics.
New product introductions are accelerating, with 284 launches in 2025 and 350 expected in 2026. Sales from products launched in the last five years rose 23% last year, strengthening portfolio vitality and supporting continued outperformance versus the broader industrial macro environment.
Management expects approximately 3% organic growth in 2026, driven by commercial excellence initiatives and innovation momentum.
Productivity gains and disciplined capital allocation, including approximately $2.5 billion in planned share repurchases this year, further support per-share earnings growth.
Based on these inputs, the model implies a value of $172 per share versus the current $166 price, suggesting the stock appears fairly valued to slightly undervalued.
Performance in 2026 will depend primarily on sustained margin execution, continued new product traction, and consistent free cash flow generation rather than rapid top-line acceleration.
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