While fast-growing momentum stocks might get the headlines, some of the best long-term investments are often far less exciting dividend growth stalwarts such as 3M (MMM).
This industrial powerhouse has made countless investors
amazingly wealthy over the years (12.9% total returns vs 9.1% for the S&P
500 over the last 22 years) thanks to its disciplined and steady growth
strategy, which includes 59 straight years of dividend increases at a
double-digit annualized rate.
Let’s take a look at what has made this venerable dividend
king one of the best choices for almost any long-term income growth portfolio
and if 3M’s valuation looks attractive today.
Business Overview
Minnesota Mining and Manufacturing, or 3M, was founded in
1902 in St. Paul, Minnesota. The global industrial conglomerate markets over
60,000 products used in homes, businesses, schools, and hospitals in over 200
countries around the world. The company has five main business segments.
Industrial: tape, sealants, abrasives, ceramics, and
adhesives for automotive, electronic, energy, food, and construction companies.
Healthcare: Infection preventions supplies, drug delivery
systems, food safety products, healthcare data systems, dental and orthotic
products.
Electronics & Energy: insulation, splicing and
interconnection devices, touch screens, renewable energy components,
infrastructure protection equipment.
Safety & Graphics: Personal protection and fall protection
equipment, traffic safety products, commercial graphics equipment, commercial
cleaning and safety products.
Consumer Products:
post-it notes, tape, sponges, construction & home improvement
products, indexing systems, and adhesives.
3M is a highly diversified company with industrial products
representing its largest business unit, while healthcare is its most profitable
segment by far.
I having been watching 3M for years. Still waiting for the PE to drop. Thanks for the info.
ReplyDeleteDFG