Jan. 16 at 11:29 AM
$MMM ⚠️ Analyst Update
JPMorgan downgrades to Neutral from Overweight, PT unchanged at
$182.
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Key takeaways:
Since May ’24, 3M shares are up 72%, outperforming the sector by 41%. Management execution on cultural and operational improvements has been strong.
Near-term trends appear sluggish and lateral, as early easy wins from self-help initiatives are largely behind.
3M is transitioning from a holding company to an operating company model: centralized R&D, tighter investment tracking, disciplined business case evaluation — positive but a multi-year journey.
To reinvigorate growth, 3M is expanding into mainstream markets, increasing its addressable market beyond the high-end 20% historically targeted.
Approach involves right-sized investments, leveraging technology platforms and AI tools to scale solutions.
Bottom line: Momentum exists, but the next phase of growth is still early and gradual, hence the Neutral rating.
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