3M defended, story ’not broken’ says analyst

Investing.com -- 3M’s sharp share-price drop has not altered the company’s fundamental trajectory, according to Wolfe Research, which argued in a note that the stock’s selloff was an overreaction and that the long-term story remains intact.

Analyst Nigel Coe wrote that “the severity of the selloff surprised many,” noting that 3M was the weakest stock on the firm’s screen after falling 7 percent despite delivering an in-line quarter and outlook.

Coe said Wolfe Research does not view the moment as a seminal one, “but rather a really bad Consumer performance.”

Organic growth rose 2.2 percent, matching guidance, while margins of 21.1 percent were at the high end of expectations, though slightly below Wolfe Research’s estimate.

Coe highlighted that Safety & Industrial and Transportation & Electronics were “in line with our model,” while Consumer results were “softer than WRe.”

The key question, according to Coe, is why the stock reaction was so outsized. He said the quarter-over-quarter slowdown in Consumer may have caught some investors off guard, but added that management remains confident the segment can grow this year.

Outside Consumer, Wolfe Research said trends across the industrial portfolio look encouraging, particularly in SIBG, where 3M delivered roughly 4 percent organic growth with strong incremental margins in the second half.

In Coe’s view, “the -7% move in the stock was an overreaction.” Wolfe Research kept its estimates largely unchanged, adjusting 2026 EPS down by just $0.07 to $8.66 and saying it remains comfortable at the high end of guidance.

The firm also noted that 3M continues to track “in line to ahead of all of its medium-term commitments” and that risk-reward now “skews favorably” with more than 50 percent upside in its bull case.

You May Also Be Interested In

• Citigroup set to join top banks in Anthropic IPO - Bloomberg
• Boeing wins $174M in U.S. defense contracts for engines, training
• Jefferies Starts IAMGOLD (IAG) at Buy