3M Company (NYSE:MMM) reports earnings on July 26 before the market opens. Investors hold low expectations of the stock ahead of the report. Six analysts tracked by Zacks Investment Research have a projection of $2.41 per share. That is lower than a per share earning of $2.59 last year.
The low expectations of 3M stock don’t occur in vain. In early June, CEO Michael Roman said the company could take a $300million in Q2 revenue hit. Roman attributed the cost to Covid-19 lockdowns in China. The CEO expects up to a $0.30 EPS headwind due to the China restrictions and forex changes. Nonetheless, amid these expectations, we believe 3M is a stock to watch.
In the last 5 days, 3M stock has gained 3% ahead of earnings. That was after the stock bottomed at $126. The gains illustrate that investors see an opportunity at the current prices following the recent drop. Any earnings-beat or positive developments from the company on Tuesday will be a bull trigger.
Moving averages join 3M support ahead of quarter earnings
Source – TradingView
Technically, 3M is recovering from the $126 bottom. MACD indicators and short-term moving averages are bullish on the stock. At the current 134 price, 3M aims for the $141 resistance. If the quarter earnings come solid, the stock may hit and potentially break the resistance. Disappointing results could see the stock crash back to the $126 level.
Summary
3M stock is starting a bullish momentum. Investors should buy/hold if the quarter results surpass estimates. The first target is $141, but the stock could ride to $152 in the next few days.
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