3M

Methodology

3M's diversified industrial business faces challenges from litigation liabilities and portfolio restructuring that distort near-term earnings, requiring careful normalization. The spin-off of the healthcare business and PFAS litigation create one-time impacts. Focus on ongoing business earnings power after adjusting for legal settlements and restructuring charges for meaningful fair value assessment.

Methodology

3M has traded at lower PEG ratios in recent years reflecting concerns about litigation overhangs, slower growth, and transformation execution risks. The metric should account for restructuring impacts and portfolio changes rather than reported GAAP earnings. Compare to diversified industrial peers while adjusting for the company's unique legal and operational challenges.

Methodology

3M offers an attractive dividend with a long history of increases, though payout sustainability depends on successful restructuring and litigation resolution. The dividend provides meaningful income but faces pressure from elevated costs and legal expenses. PEGY better captures total return potential while acknowledging dividend risks during this transformation period.