Shiller PE Mean Reversion
MMM's shiller PE of 10.72 is currently 53% below its 10 year historical mean of 23.01. MMM's Shiller PE is also ranked better than 61% in its industry. A 10-20 year mean reversion would imply a PT of 180-190. With that being said there would have to be quite a bit of fundamental changes for the company to surpass the mean and reclaim its 10 year max PE of 37.1. Any significant milestone in the litigation with probable outcomes may provided the required stabilization for reversion to mean to begin.
Litigation fears hang over MMM, but the valuation significantly decreases this risk. Withstanding the litigation, there is a disparity between the growth and valuation based on profitability relative to industry. Its growth prospects by every metric are significantly lower, than industry, however when comparing valuation and profitability-despite a decline in profitability over last 5 years, to industry MMM receives significantly higher marks by almost every metric in both categories which also significantly de-risks the litigation aspect.
From a TA perspective, MMM is currently sitting right below its lowest trendline that you'd have to go back to financial crisis and 1982 to view. The current SP is sitting at the lowest point of a primary down trend.
Litigation fears hang over MMM, but the valuation significantly decreases this risk. Withstanding the litigation, there is a disparity between the growth and valuation based on profitability relative to industry. Its growth prospects by every metric are significantly lower, than industry, however when comparing valuation and profitability-despite a decline in profitability over last 5 years, to industry MMM receives significantly higher marks by almost every metric in both categories which also significantly de-risks the litigation aspect.
From a TA perspective, MMM is currently sitting right below its lowest trendline that you'd have to go back to financial crisis and 1982 to view. The current SP is sitting at the lowest point of a primary down trend.
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