This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Bad Tidings From 3M

3M (MMM - Get Report) slid 7% Friday after the manufacturer warned that second-quarter earnings will miss previous forecasts.

Before items, 3M expects to earn $1.04 to $1.09 a share on sales of $5.7 billion in the quarter. Analysts surveyed by Thomson First Call were forecasting earnings of $1.17 a share on sales of $5.71 billion in the quarter. The miss sent the stock down $5.96, or 7.3%, to $75.43.

"This second-quarter performance was impacted in large part by lower-than-expected sales volumes and higher-than-anticipated new capacity start-up costs in its optical systems division, a part of 3M's display and graphics business segment," the company said.

"As other companies in the LCD industry have recently noted, the industry has experienced an increase in inventory levels over the last few months, particularly in desktop monitors, which has significantly impacted sales of 3M optical films," the company said. "Coincident with this, it appears the industry overestimated demand for LCD televisions in anticipation of the FIFA World Cup and has temporarily reduced production accordingly, also impacting sales of our optical films.

"Finally, as demand for LCD TV accelerates, we expect LCD film sales will increasingly follow more seasonal patterns, with revenues being lowest in the second quarter and higher in the third and fourth quarters in anticipation of the holiday season," 3M said.

The earnings warning was badly timed for J.P. Morgan, which earlier Friday argued the shares are relatively cheap, particularly for this late stage of a strong economic cycle. The brokerage upgraded the stock to overweight from neutral.

"A high-quality portfolio that shows relatively less cyclicality with a pristine financial position makes 3M an excellent 'late, late' cycle stock," J.P. Morgan wrote. "3M exhibited significant outperformance through the turbulence of the last recession."
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
MMM $167.77 0.00%
AAPL $93.24 0.00%
FB $117.81 0.00%
GOOG $701.43 0.00%
TSLA $211.53 0.00%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs