3M Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component 3M (NYSE:MMM) will unveil its latest earnings tomorrow, Thursday, January 24, 2013. 3M is a global manufacturer, technology innovator, and marketer of a variety of products.

3M Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of $1.41 per share, a rise of 4.4% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from $1.49. Between one and three months ago, the average estimate moved down. It has been unchanged at $1.41 during the last month. For the year, analysts are projecting net income of $6.32 per share, a rise of 6% from last year.

Past Earnings Performance: Last quarter, the company missed estimates by one cent, coming in at profit of $1.65 per share versus a mean estimate of net income of $1.66 per share. In the second quarter, the company beat estimates by one cent.

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A Look Back: In the third quarter, profit rose 6.7% to $1.16 billion ($1.65 a share) from $1.09 billion ($1.52 a share) the year earlier, but fell short analyst expectations. Revenue fell 0.5% to $7.5 billion from $7.53 billion.

Here’s how 3M traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

MMM

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.2 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 2.47 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 15.6% to $6.59 billion while assets rose 2.9% to $14.49 billion.

Analyst Ratings: There are eight out of 13 analysts surveyed (61.5%) rating 3M a buy.

Key Stats:

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last three quarters. Net income rose 4.1% in the first quarter and 0.6% in the second quarter before increasing again in the third quarter.

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 1.9% in the second quarter and dropped again in the third quarter.

Wall St. Revenue Expectations: Analysts predict a rise of 1.3% in revenue from the year-earlier quarter to $7.18 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)