Industrials

Even 3M Earnings Could Not Escape Strong Dollar This Time

3M_logo
Courtesy 3M Company
3M Co. (NYSE: MMM) reported first-quarter 2015 results before markets opened Thursday morning. The conglomerate posted diluted earnings per share (EPS) of $1.85 on revenues of $7.6 billion. In the same period a year ago, the company reported EPS of $1.79 on revenues of $7.83 billion. First-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $1.93 and $7.84 billion in revenues.

Organic local-currency sales grew 3.3% and foreign currency translation reduced sales by 6.5% year-on-year.

3M lowered its full-year earnings expectation from a prior range of $8.00 to $8.30 per share to a new range of $7.80 to $8.10. Currency translation effects are now expected to cut full-year sales by 6% to 7%, up from a prior estimate of 4% to 5%. The current consensus analysts’ estimate calls for full-year EPS of $8.14 on sales of $32.01 billion.

The company maintained its forecast for organic local currency growth in a range of 3% to 6%.

The consensus analysts’ estimates for the second quarter call for EPS of $2.07 on revenues of $8.14 billion.

The company’s CEO said:

The stronger U.S. dollar negatively impacted sales and earnings in the first quarter, and global economic growth was mixed. Despite these near-term challenges, we grew organically in all business groups and all geographic areas, and expanded operating margins by nearly a full percentage point.

3M posted total quarterly sales growth only in its electronics and energy division, and that by just 0.8% (organic sales up 5.8% in local currency). Total consumer division sales were down 2.9% (up 2.1% in local currency) and total health care sales were down 3.3% (up 3% in local currency). The company’s largest division, industrial, posted total sales of $2.7 billion, down 4.3% but up 2.7% on an organic local currency basis. Safety and graphics division sales slipped 3.6% but were up 4.1% in local currency.

3M’s shares traded down nearly 2% in the premarket Thursday to $161.50. The current 52-week range is $130.60 to $170.50. Thomson Reuters had a consensus analyst price target of $168.00 before the report.

ALSO READ: 5 Cheap Large Cap Stocks to Buy in an Expensive Stock Market

Is Your Money Earning the Best Possible Rate? (Sponsor)

Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.

However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.

There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.