January 23, 2024 | Daily JAM, MMM, Morning Briefing, Short Term |
3M (MMM) fell 11.03% today, Tuesday, January 23, the most in nearly five years, after announcing projections for 2024 sales and earnings below Wall Street expectations. Now granted that 3M is a special case–the company is engaged in a huge restructuring effort that has met with a high degree of investor skepticism. In short, investors doubt that the company can pull it off without cutting its dividend. So the stock is especially sensitive to any news that suggest that the restructuring is failing. But the stock’s big drop today is also an indication of how worried this market, trading at record highs, is about the possibility that earnings growth for the fourth quarter, the subject of the current earnings season, won’t support prices at these levels.
May 2, 2023 | Daily JAM, Mid Term, MMM, Videos |
This week’s Trend of the Week is The Pain is Spreading. By pain, I mean layoffs. It started with technology companies as we saw job cuts from companies like Meta Platforms, Amazon, and Alphabet. Then recently announced cuts of 7,000 employees. Now, layoffs are spreading to other areas of the market. 3M (NYSE: MMM), a generally reliable blue chip stock, announced they’d be cutting 2,500 jobs back in January and have now added 6,000 more jobs to the chopping block- about 10% of their total workforce. This is in reaction to slowing sales and the potential for losses from liability lawsuits. In the most recent quarter, organic sales were down 4.9% (better than the expected 6.9%) with a guidance of a 2% sales decline for 2023. While 3M is trying to cut costs with layoffs, Wall Street remains skeptical. 3M hasn’t seen the rally other blue chip stocks have seen recently. The company has so many products out there, it is representative of the market as a whole. And this one example plays into the bigger picture of the slowing economy, greater job losses, and, possibly, a recession.
December 8, 2022 | ABBV, Daily JAM, Dividend Income, MMM |
Once a company has put in the time and money to make the Dividend Aristocrats list, the company isn’t likely to squander that investment just because a recession looms. To make the list–and garner a big chunk of cash from conservative dividend investors–a company has had to pay a dividend for a least 25 consecutive years and has had to raise that dividend every year. A company like 3M (MMM), which owns a 64-year record of paying and raising its dividend payout, is as close to a dividend sure thing as exists. Which is why it’s not surprising that AbbVie (ABBV), which owns a 50-year record of paying and raising its dividend, announced that it would raise its dividend in 2023 to $1.48 a quarter with the February 2023 payout. That would bring the annual dividend yield to 3.5% But…
