MMM
3M Company
$172.62
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 12.3% above fair value
You pay
$172.62
Bear
$123.02
Fair
$153.78
Bull
$184.54
Bear
$123.02
-28.7%
$9.36 × 12x P/E
Fair
$153.78
-10.9%
$9.36 × 15x P/E
Bull
$184.54
+6.9%
$9.36 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
18.4x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $185.00 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $153.78 per share.
Warnings
The company's reported profits differ from official accounting profits by 56%. Check what costs are being left out of the adjusted number.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples