3M (NYSE:MMM) reminds me of a steady old draft horse. On a normal day, it'll plow your field at around 2.5 mph. On a great day, it'll plow your field at around 2.5 mph. On a terrible day, it'll plow your field at around 2.5 mph. In other words, 3M is probably not the name to go to when conditions in the broader global economy are screaming "growth!", but you'll appreciate what it can do when the global growth outlook bumps along a flat line.
I believe there are ways that 3M can, and
should, improve its long-term performance. There's more margin leverage
to be gained from efficiency/productivity improvements, and I would like
to see the company shift more R&D spending toward disruptive
innovation. As things sit today, the shares are not cheap on a
discounted cash flow basis, but they don't look unreasonably priced on
the basis of a relative valuation model that takes into account ROE,
stability of performance, and interest rates. What's more, there aren't a
surplus of great industrial names that are remarkably cheap.
Read more here:
3M's Steady Hand More And More Valuable In A Weak Macro Environment