# 3M (MMM)

Sector: Diversified industrials

| Field | Value |
|---|---|
| Price | $188.63 |
| Market cap | $97B |
| Intrinsic value source | Analysts |
| Data as of | 2026-11-10 |
| Next earnings | 2027-01-19 (estimate) |

Analysts: Leaning bullish

Picks: Research only

Discount category: Far above intrinsic value

## In short

Investors pay a premium for 3M's margin turnaround and its PFAS settlement, and only strong claimant participation with steady EPS growth in 2027 can earn it.

## Themes and gap

- Themes: Regulation and courts (regulation-legal), Tariffs and trade (trade-tariffs)
- Gap type: Can close (closable)
- Why: The Q4 2026 report with 2027 guidance, expected in January 2027, and claimant participation in the PFAS settlement test the premium within about a year.

## About

3M makes industrial, safety, transportation, electronics and consumer products from its materials science, such as adhesives, abrasives, films, respirators, hearing protection and optical connectivity products for data centers. It spun off its health care business as Solventum in April 2024 and still holds Solventum shares. It is leaving the manufacture of PFAS. In July 2026, with Bain Capital, it bought Madison Fire & Rescue, a maker of rescue and fire suppression products, for $1.9 billion. Sales were $6.6 billion in Q3 2026.

## Thesis

3M trades at a premium because investors pay for a turnaround in margins and for the end of its largest legal risks. The adjusted operating margin rose to 26.2% in Q3 2026, adjusted EPS grew 12% to $2.50 and the company raised its 2026 guidance to $9.10 to $9.15. On November 3, 2026, it agreed to settle most PFAS personal injury claims in the AFFF MDL for $7.35 billion over 2026 to 2034. The price assumes that adjusted EPS keeps growing near a double-digit rate and that legal costs stay inside the agreed settlements. For the premium to be earned, three things must be true. Enough claimants must join the new settlement, so 3M does not end it and few claims remain outside it. Adjusted organic sales growth must stay near 3% or more, with help from data center and optical products. Adjusted free cash flow must stay near the 2026 guidance of about $4.8 billion, because settlement payments come on top of it. The Q4 2026 report with 2027 guidance, expected in January 2027, gives the next test, and the participation result of the settlement gives another. If participation is low or growth slows, the premium can shrink within one to two years.

## Checkpoints

- Oct 20, 2026: Q3 2026 results. Status: Passed. Watch: Adjusted organic growth near 3% or more, a higher adjusted margin and higher guidance pass; lower guidance fails. Outcome: Adjusted organic sales rose 3.3%, the adjusted operating margin rose to 26.2% and 3M raised its 2026 adjusted EPS guidance to $9.10 to $9.15.
- Jan 19, 2027 (estimate): Q4 2026 results and 2027 guidance. Status: Pending. Watch: 2027 guidance for adjusted EPS growth near 8% or more and adjusted free cash flow near 2026 levels pass; weak guidance or new legal charges fail.
- 2027 (estimate): Participation in the PFAS personal injury settlement. Status: Pending. Watch: Participation above the thresholds, so the settlement goes ahead, passes; low participation or a decision by 3M to end the settlement fails.

## Balance sheet

- Cash: $5.1B
- Debt: $15.0B
- Net debt: $9.9B
- Debt due within 12 months: $2.4B

At September 30, 2026, 3M had cash of $4.84 billion and marketable securities of $0.31 billion. Debt was $15.0 billion: $2.44 billion of short-term borrowings and current debt and $12.56 billion of long-term debt. In September 2026, 3M sold €1.5 billion of notes, and it repaid $650 million of debt in the first nine months of 2026. It had no commercial paper outstanding. It also held Solventum shares worth $2.25 billion. Litigation is a large part of its obligations: other environmental liabilities, mostly for PFAS, were $7.5 billion, of which $2.8 billion is current, and the earplug settlement accrual was $1.1 billion. The new PFAS personal injury settlement adds a pre-tax charge of about $5.8 billion in Q4 2026. Total equity was $4.17 billion.

As of 2026-09-30.

Sources:

- https://www.sec.gov/Archives/edgar/data/66740/000006674026000308/q32026-8kerexx991.htm
- https://www.sec.gov/Archives/edgar/data/66740/000006674026000311/mmm-20260930.htm
- https://www.sec.gov/Archives/edgar/data/66740/000006674026000318/mmm-20261103.htm

## Dividends

- Dividend yield: 1.6% (last 12 months, at the current price)
- Paid per share, last 12 months: $3.07 (4 payments)
- Current annual rate: $3.12 ($0.78 x 4 a year)
- Payout ratio: 49% of the earnings of the last fiscal year (the year ended 2025-12-31)
- Latest ex-dividend date: 2026-08-24, $0.78 per share
- Growth over the last 5 years: -9.1% a year
- Growth over the last 10 years: -1.7% a year

Dividends per share by year: 2016: $3.7124, 2017: $3.9298, 2018: $4.5485, 2019: $4.8161, 2020: $4.9164, 2021: $4.9498, 2022: $4.9833, 2023: $5.0167, 2024: $3.3625, 2025: $2.92.

Source: company filings and market data, read on 2026-11-09.

## Recent events

- 2026-11-03: 3M agreed to a settlement that is intended to resolve most PFAS personal injury claims in the AFFF multidistrict litigation. 3M will pay a nominal total of $7.35 billion between 2026 and 2034, if enough claimants join. It will record a pre-tax charge of about $5.8 billion in Q4 2026 and does not admit liability.
- 2026-10-20: 3M reported Q3 2026 results. Sales rose 1.0% to $6.6 billion, and adjusted organic sales rose 3.3%. The adjusted operating margin rose to 26.2%, and adjusted EPS rose 12% to $2.50. GAAP EPS was $2.63. Adjusted free cash flow was $1.2 billion. 3M raised its 2026 guidance to adjusted EPS of $9.10 to $9.15 and adjusted free cash flow of about $4.8 billion. It also reported a broader agreement with Amazon for optical connectivity and other data center products.
- 2026-09-03: 3M agreed to sell €1.5 billion of notes: €500 million each of 3.500% notes due 2028, 3.900% notes due 2031 and 4.100% notes due 2034.
- 2026-07-21: 3M reported Q2 2026 results. Adjusted organic sales rose 5.4%, the adjusted operating margin was 24.9% and adjusted EPS rose 11% to $2.40. It raised its 2026 adjusted EPS guidance to $8.80 to $8.95.

## Latest news and filings

- Last earnings: 2026-10-20 (8-K: https://www.sec.gov/Archives/edgar/data/66740/000006674026000308/)
- Next earnings: 2027-01-19 (expected; the company has not confirmed it)

| Filed | Form | Headline | Period end | XBRL document | Link |
| --- | --- | --- | --- | --- | --- |
| 2026-11-04 | 8-K | New material agreement and Other company news |  | mmm-20261103 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000318/mmm-20261103.htm |
| 2026-10-20 | 10-Q | Quarterly report for the period ended Sep 30, 2026 | 2026-09-30 | mmm-20260930 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000311/mmm-20260930.htm |
| 2026-10-20 | 8-K | Earnings release |  | mmm-20261020 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000308/mmm-20261020.htm |
| 2026-10-19 | 8-K | Investor disclosure |  | mmm-20261019 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000303/mmm-20261019.htm |
| 2026-09-10 | 8-K | Other company news |  |  | https://www.sec.gov/Archives/edgar/data/66740/000110465926106710/tm2624999d1_8k.htm |
| 2026-08-19 | 8-K | New material agreement and End of a material agreement |  | mmm-20260817 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000268/mmm-20260817.htm |
| 2026-07-21 | 10-Q | Quarterly report for the period ended Jun 30, 2026 | 2026-06-30 | mmm-20260630 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000246/mmm-20260630.htm |
| 2026-07-21 | 8-K | Earnings release |  | mmm-20260721 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000242/mmm-20260721.htm |
| 2026-06-08 | 8-K | Change of directors or officers |  | mmm-20260605 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000229/mmm-20260605.htm |
| 2026-05-13 | 8-K | Shareholder vote results |  | mmm-20260512 | https://www.sec.gov/Archives/edgar/data/66740/000006674026000221/mmm-20260512.htm |

Every filing on SEC EDGAR (CIK 66740): https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000066740&type=&dateb=&owner=include&count=40

## Risks

- High: PFAS litigation is not over. The new personal injury settlement needs enough claimants to join, and 3M can end it if participation is too low. Other PFAS cases, including state cases and water suppliers outside the earlier settlement, remain. 3M had recorded other environmental liabilities of $7.5 billion at September 30, 2026.
- Medium: Demand from industry, consumer electronics and cars is weak in parts of the business. GAAP organic sales grew only 0.2% in Q3 2026. Slower growth makes the EPS targets harder to reach.
- Medium: Settlement payments use a large part of the cash. With the earplug settlement accrual of $1.1 billion and the new $5.8 billion charge, cash for buybacks and growth can be lower for years.
- Low: Tariffs and trade disputes can raise costs and slow demand, because 3M makes and sells products in many countries.

## Links

- Page: https://picks.utilarium.app/company/MMM/
- History of changes: https://picks.utilarium.app/company/MMM/history/
- JSON with full history: https://picks.utilarium.app/data/company/MMM.json

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