For the third quarter, 3M is expected to see year-over-year revenue growth across all its segments. Other factors that could benefit the company include strong products, strategic portfolio reviews and innovation as well as stable end-market demand.
The factors that could hurt 3M include tough competition, negative impacts from foreign currency and higher expenses. The company can expect continued pressure from increases in raw material costs for the third quarter and the foreseeable future.
In the second quarter, 3M delivered better-than-expected results, with a 7% increase in revenue and a 19% improvement in EPS. The revenue growth was driven by a 15.8% sales increase in the safety and graphics business. The company also recorded a benefit of $0.48 per share from the divestiture of its communication markets business in the quarter.
Last quarter, 3M updated its full-year 2018 earnings guidance to reflect the impact from the divestiture. GAAP EPS is expected to be $9.08 to $9.38 while adjusted EPS is expected to be $10.20 to $10.45.
3M’s shares have dropped more than 14% year to date. Looking at the past one month, the stock is down 5%.