Conservative · Stocks to Consider and Updates

3M Scores Strong Results; Raises Dividend and Improves Outlook

Diversified products maker 3M Co. (NYSE: MMM – $253.86) announced adjusted fourth quarter share earnings of $2.10, 11.7% over the year-earlier tally and $0.09 ahead of Wall Street estimates. Sales also impressed, totaling $7.99 billion, 9.0% above the previous-year mark. Europe, Middle East & Africa led the charge, posting a 17.1% advance, followed by Asia-Pacific and Latin America/Canada, which posted respective increases of 14.4% and 4%. Sales in the U.S. climbed 3%, which came as a bit of a surprise as domestic growth had been hard to come by in recent years. Segment wise, Safety & Graphics remained the leader in terms of growth, despite divestitures, with Electronics & Energy close behind.

The global conglomerate raised its earnings guidance for 2018. Management said that it now expects to earn $10.20-$10.70 a share this year, up from its previous $9.60-$10.00 call. It maintained its 3%-5% organic local-currency sales growth estimate, but lowered its anticipated tax rate to a range of 20%-22%, down from its earlier 26%-27% forecast.

The company also declared a 16% increase in the quarterly dividend to $1.36 per share payable March 12, 2018, to shareholders of record on Feb. 16, 2018. Investors like what they are seeing here. The stock is trading 2.5% higher today on the news to an all-time high, and is now up roughly 41% in value over the past 12 months. The company’s strong cash flow generation and solid finances should only help to add to investor returns and positions can continue to be maintained in a conservative portfolio.

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