Despite what critics have said of late, 3M (NYSE:MMM) is actually a very solid and safe company for investors. MMM stock has at least 45% upside from current prices based on its dividend-paying track record and solid cash flow. The company has been in the news lately due to its production of masks and other products used to fight the novel coronavirus. The company faced criticism from the President and others for exporting some of its N95 respirator masks.
Value investors have learned to catch stock bargains when a company has trouble that is temporary in nature. MMM stock really seems to be in one of those temporary binds. For example, last year 3M generated $7.07 billion in cash flow from operations (CFFO). It spent just $1.7 billion in capex. So its free cash flow, available to be spent on dividends, was $5.37 billion. But here’s the thing. 3M’s dividend, currently at $5.88 per share (dividend yield is 4%), costs the company just $3.32 billion annually. So the company, based on last year’s cash flow, can absorb a big hit to earnings and still afford the dividend. In fact, CFFO would have to fall by as much as $2 billion, or 38% before the dividend literally could not be covered by existing FCF.
Source: InvestorPlace
Related Articles:
- 8 Dividend Stocks For A Rainy Day
- 5 Dividend Growth Stocks With Strong Capital Appreciation
- 5 Higher Yielding Basic Materials Stocks With Growing Dividends
- 4 Dividend Growth Stocks That Could Make You Wealthy
- A Roadmap To Build Wealth With Dividend Stocks
3M Stock Has Secure Dividends and Ample Cash Flow
Posted by D4L | Wednesday, May 13, 2020 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
In short, dividend-bearing stocks are one of the smartest approaches stock investors have available currently. The same is true in strong ec...
-
If your growth-investing days are over (or nearly so) and you're more interested in steady income, start your search with all-weather st...
-
Even in the current inflationary environment, where stocks across a wide variety of sectors are trading down, companies with a favorable his...
-
Finding cheap dividend stocks is critical for another reason. By the time the Federal Reserve meets for the second time in 2023, the central...
-
Investing in passive income can allow you to make money with minimal portfolio management. There are many types of investments to make passi...
-
Many companies make very predictable fixed dividend payments each quarter. When they do, their investors have a pretty good idea of how much...
-
As 2022 wraps up, many investors are likely looking for ways to position their portfolio for more macroeconomic uncertainty next year. After...
-
Linked here is a detailed quantitative analysis of Chevron Corporation (CVX). Below are some highlights from the above linked analysis: Comp...
-
Warren Buffett's Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) is crushing the market this year as value and dividend stocks have pulle...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.