User 231796

Four Long-Term Winners Selling at Deep Discounts

I agree with your assessment that it's deeply under-valued. I don't agree that the 16X multiple is normal. Since 1997, the average P/E for MMM has been 24X. The market has paid down the P/E on MMM since 2003, when it was at 28X. More importantly, MMM generates alot more operational cash than reported earnings. ROE consistently stays in the 15-25% range. They have committed to a minimum 10% annual earnings growth rate, acquisition appears to be the bread and butter of this plan. Any conservative intrinsic value formula, inputting Armeggedon assumptions, still values MMM at $100 today. Throw in 60% earnings from overseas and I think MMM is safer than mothers milk for the long term investor.