3M Stock Valuation

MMM
 Stock
  

USD 112.99  1.15  1.01%   

What is the enterprise value of 3M? Calculating the true value of any business is not as easy as it may seem. While the market cap of a public entity, such as 3M, is its stock price multiplied by the total number of shares outstanding, calculating 3M's enterprise value requires a different approach. It uses 3M's balance sheet items such as long-term debt, the book value of the preferred stock, minority interest, and other important financials.
3M Company owns a latest Real Value of $134.95 per share. The recent price of the firm is $112.99. At this time, the firm appears to be undervalued. Our model approximates the value of 3M Company from evaluating the firm fundamentals such as Return On Asset of 8.93 %, shares outstanding of 553.61 M, and Shares Owned by Insiders of 0.12 % as well as inspecting its technical indicators and Probability Of Bankruptcy. In general, we favor acquiring undervalued equities and dropping overvalued equities since, sooner or later, asset prices and their ongoing real values will grow together.
  
3M Valuation Module provides a unique way to ballpark how much the company is worth today. It is done using both, our quantitative analysis of the company fundamentals as well as its intrinsic market price estimation to project the real value. We also take into consideration other essential factors such as 3M's management style, its c-level domain expertise and tenure, its overall leadership history as well as current capital structure, and future earnings potential.
Undervalued
Today 112.99
Please note that 3M's price fluctuation is very steady at this time. Calculation of the real value of 3M Company is based on 3 months time horizon. Increasing 3M's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for 3M Company is useful when determining the fair value of the 3M stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of 3M. Since 3M is currently traded on the exchange, buyers and sellers on that exchange determine the market value of 3M Stock. However, 3M's intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value.
101.69
Downside
134.95
Real Value
136.93
Upside
Estimating the potential upside or downside of 3M Company helps investors to forecast how 3M stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of 3M more accurately as focusing exclusively on 3M's fundamentals will not take into account other important factors:
Hype
Prediction
LowEstimated ValueHigh
111.44113.42115.40
Details
15 Analysts
Consensus
LowTarget PriceHigh
172.00188.54215.00
Details

3M Valuation Ratios as Compared to Competition

Comparative valuation techniques use various fundamental indicators to help in determining 3M's current stock value. Our valuation model uses many indicators to compare 3M value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across 3M competition to find correlations between indicators driving 3M's intrinsic value. More Info.
3M Company is considered to be number one stock in beta category among related companies. It is considered to be number one stock in price to book category among related companies fabricating about  4.88  of Price to Book per Beta. . Comparative valuation analysis is a catch-all model that can be used if you cannot value 3M by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for 3M's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the 3M's earnings, one of the primary drivers of an investment's value.
Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates 3M's worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in 3M and how it compares across the competition.

About 3M Valuation

The stock valuation mechanism determines the current worth of 3M Company on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of 3M Company. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of 3M Company based exclusively on its fundamental and basic technical indicators. By analyzing 3M's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of 3M's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of 3M. We calculate exposure to 3M's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to 3M's related companies.
3M Company operates as a diversified technology company worldwide. It offers its products through e-commerce and traditional wholesalers, retailers, jobbers, distributors, and dealers. 3M operates under Conglomerates classification in the United States and is traded on New York Stock Exchange. It employs 95000 people.
3M's stock price is the clearest measure of market expectations about its performance. Without stock valuation, investors cannot independently discern whether 3M's value is low or high relative to the company's performance and growth projections. Determining the market value of 3M can be done in different ways, such as multiplying its stock price by its outstanding shares.
A single share of 3M represents a small ownership stake in the entity. As a stockholder of 3M, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.

3M Dividends Analysis For Valuation

There are various types of dividends 3M can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of 3M shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from 3M Company directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When 3M pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of 3M by the value of the dividends paid out.

3M Valuation Growth Rates

Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as 3M does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
Quick Ratio0.80
Earnings Quarterly Growth-94.90%
Revenue Growth-2.80%
Payout Ratio82.96%
Enterprise Value To Ebitda9.37
Earnings Growth-94.70%
Enterprise Value To Revenue2.30
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Is 3M's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of 3M. If investors know 3M will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about 3M listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of 3M Company is measured differently than its book value, which is the value of 3M that is recorded on the company's balance sheet. Investors also form their own opinion of 3M's value that differs from its market value or its book value, called intrinsic value, which is 3M's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because 3M's market value can be influenced by many factors that don't directly affect 3M's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between 3M's value and its price as these two are different measures arrived at by different means. Investors typically determine 3M value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, 3M's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.