Adhesive manufacturer 3M Co (NYSE: MMM) reported better-than-anticipated fiscal 2021 fourth-quarter earnings and revenue. However, on a y-o-y basis, the fourth-quarter earnings recorded a decline. Still, the stock of Post-it Note manufacturer rallied $0.95 or 0.55% to close at $173.75.
The Saint Paul, Minnesota-based company, reported fourth-quarter revenues of $8.61 billion, an increase of 0.3% from $8.58 billion in the similar period last year.
For the quarter ended December 31, 2021, 3M recorded a net income of $1.339 billion, or $2.31 per share, compared with $1.405 billion, or $2.41 a share, in the quarter ended December 31, 2020.
Excluding charges (none), the 4Q 2021 non-GAAP earnings were $1.339 billion, or $2.31 per share, down from $1.405 billion, or $2.41 a share, in 4Q 2020.
Analysts surveyed by Refinitiv had anticipated 3M to report earnings of $2.02 per share on revenues of $8.60 billion for the reported quarter.
Commenting on the fourth-quarter earnings, Chairman and CEO Mike Roman said, “3M delivered a solid fourth-quarter performance – with notable strength in December – as we maintained our relentless focus on serving customers in a challenging external environment.”
Segment-wise,
- Safety and Industrial revenues declined 2.20 y-o-y to $3.064 billion. Despite the decrease, organically, sales increased in closure and masking systems, industrial adhesives, tapes and abrasives, electrical markets, and automotive aftermarket goods. However, sales dropped in personal safety products and roofing granules.
- Electronics and Transportation revenues were $2.306 billion, down 1.50% from last year. While advanced materials and commercial solutions recorded an increase in sales; transportation safety, electronics, and automotive posted a drop in sales.
- Health Care revenues rose by 0.75% y-o-y to $2.275 billion. Separation and purification, health information systems, food safety, and oral care products reported an increase in sales, while medical solutions posted a drop in sales.
- Consumer revenues were $1.476 billion, up 4.10% on a y-o-y basis. Consumer health and safety, home improvement, stationery and office, and home care products posted a growth in sales.
During Q4 2021, 3M reported operating cash flow of $2 billion and adjusted free cash flow of $1.50 billion. Furthermore, the company paid back $1.80 billion to shareholders in the fourth quarter, including $848 million in cash and $938 million in share repurchases.
The quarterly earnings beat is expected to keep the stock range-bound with a slight bullish bias in the short term.
The historical price chart indicates that the stock of 3M is trading a notch above the major support level of 175. The stochastics RSI indicator is also in the oversold region. Therefore, we are anticipating the stock to begin a fresh uptrend in the days ahead. It will be wise to open a position after the stock breaks above the 50-day moving average.
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