Peet Serfontein & Khumbulani Kunene
We enter a long position with a target price of $177 and a stop-loss of $142.
3M Company is a diversified global manufacturer, technology innovator, and marketer of a wide variety of products (including adhesives, abrasives, filtration systems, electronic materials, medical supplies and personal protective equipment). The firm develops and produces a broad range of industrial, safety, healthcare and consumer products that are used across numerous sectors of the global economy. Its operations are built around advanced materials science and engineering capabilities.
The company has operations spanning across more than 70 countries and customers in nearly every major market. 3M also boasts a highly-diversified revenue base which reduces reliance on any single industry or geographic region.
Technically, the price testing the lower range of an upsloping broadening-top pattern presents an attractive buying opportunity (see the black diverging trendlines on the main chart). This pattern reflects 3M's recent price movement which has transitioned from a period of steady recovery into a more balanced consolidated phase. A breach of the upper boundary could act as a launchpad for a stronger upward movement, supporting the bullish stance.
In addition, the shift to green Heikin-Ashi candles signals improving momentum (see the insert). The transition to green candles acts as a technical support zone and for as long as the price holds above this area, it reflects acceptance of higher prices.
| Share Information | |
|---|---|
| Share Code | MMM US |
| Industry | Capital Goods |
| Market Capital (USD) | 79.69 billion |
| One Year Total Return | 14.89% |
| Return Year-to-Date | -4.28% |
| Current Price (USD) | 152.55 |
| 52 Week High (USD) | 177.41 |
| 52 Week Low (USD) | 124.65 |
| Financial Year End | December |
| The price remains below its 200-day simple moving average (SMA) but is steadily approaching it. This area typically acts as a dynamic resistance level and a sustained move towards it suggests improving momentum, stronger accumulation and potential trend reversal dynamics. | |
| Consensus Expectations (Bloomberg) | ||||
|---|---|---|---|---|
| FY25 | FY26E | FY27E | FY28E | |
| Headline Earnings per Share (USD) | 8.06 | 8.66 | 9.43 | 10.08 |
| Growth (%) | 7.47 | 8.81 | 6.93 | |
| Dividend Per Share (USD) | 2.92 | 3.16 | 3.36 | 3.41 |
| Growth (%) | 8.08 | 6.37 | 1.46 | |
| Forward PE (times) | 17.61 | 16.19 | 15.14 | |
| Forward Dividend Yield (%) | 2.07 | 2.20 | 2.23 | |
| The company is set to deliver positive earnings growth over the medium term with management recently highlighting that they are on track to meet or exceed their 2027 goals. | ||||
Buy/Sell Rationale:
Technical Analysis:
Fundamental view:
| Share Name and Position | VST - Buy (Continue to hold) |
AXP - Buy (Continue to hold) |
|
|---|---|---|---|
| Entry | 152.72 | 307.03 | |
| Current Price | 163.97 | 326.96 | |
| Movement | +7.4% | +6.5% | |
| Comment | The price in a developing rising wedge pattern remains of interest. Remains below its 200-day SMA and the trade is regarded as a counter-trend strategy. Fading downside momentum is supportive. Out profit target is $193.00 with a trailing stop-loss at $155.00. | The price testing the lower range of an upsloping inclining channel pattern remains of interest. Remains below its 200-day SMA but approaching it. Fading downside momentum is supportive. Out profit target is $352.00 with a trailing stop-loss at $316.00. | |
| Time to exit | 1 July 2026 | 8 July 2026 |
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