ST. PAUL, Minn.-- (BUSINESS WIRE)-- The 3M Board of Directors (NYSE:MMM) today declared a dividend on the company’s common stock of $1.47 per share for the second quarter of 2020. In addition, it's somewhat concerning that management is still arguing that the swing factor in meeting its target for annual organic sales growth of 3% to 5% is the macroeconomic environment, rather than taking more aggressive action with the consumer and healthcare segments.Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Long-term debt at ~$2,763M is not a major issue right now and interest coverage is over 20X. Moreover, 3M's valuation and the potential for a turnaround are good reasons to keep an eye on the stock for now, rather than put it on the buy list.Data source: Company presentations, analyst estimates from www.marketscreener.comPutting these issues into context, 3M can be forgiven for near-term weakness, but the potential PFAS liability is an obvious worry.
The company has grown its dividend for the last 61 consecutive years and is increasing its dividend by an average of 29.73% each year. According to analyst estimates, earnings (measured here in terms of EBITDA) and FCF are set for solid growth in the coming years, and FCF easily covers the $3.3 billion in dividends paid in the last 12 months.Data source: Company presentations. Interest coverage is over 17X, and 3M had almost $7.7B in cash, cash equivalents, and short-term investments at end of Q3 2019.
3M Company is a Dividend King and Dividend Aristocrat having raised the dividend for 61 straight years. I provide quick pick analyses of MSC Industrial Direct, Dollar General, and 3M Company. This is near my threshold, but still below 70%. digital coupon and cashierless checkout strategy is expanding and should reduce costs. Mike Roman, 3M chief executive officer: The company has high exposure to other cyclical industries and manufacturers as a supplier to them. As of March 31, 2020, 3M had 575,196,371 common shares outstanding and 73,417 shareholders of record.The following errors must be corrected:3M has paid dividends to its shareholders without interruption for more than 100 years.To opt-in for investor email alerts, please enter your email address in the field below and select at least one alert option. The payout ratio is about 60%, below my criteria of 65%, and the dividend-to-FCF ratio is ~53%, below my threshold of 70%. For reference, its target for healthcare is for 4% to 6% organic sales growth over the mid-term, and for the consumer segment to grow 2% to 4%.
3M has paid dividends to its shareholders without interruption for more than 100 years. Dividend King 3M is set to be one of the most interesting stocks of 2020. The current yield is ~3.8%. Dividend Growth Rate Summary. The dividend is payable June 12, 2020… While the cyclical weakness in the other two segments -- mainly coming from China, automotive, and consumer electronics -- could turn in the future.Price to free cash flow multipleThe glass-half-empty approach has three key points to it:Meanwhile, CEO Mike Roman is taking action to revitalize the company, which now operates out of four segments instead of five. This is currently elevated due to high spending for capital expenditures. The company recently raised the regular dividend 19%, and just last month, it announced a special dividend of $5.00 per share. From this perspective, the company went from five to four business segments, bought Acelity expanding in the wound dressing business, and is divesting the drug delivery business. Online retailers are less of threat due to the smaller average transaction size of ~$12 and the higher costs for delivery in rural areas. After submitting your request, you will receive an activation email to the requested email address. If you experience any issues with this process, please contact us for further assistance. Earlier this year, 3M bought a wound care company, Acelity, for a total enterprise value (market cap plus net debt) of $6.7 billion.