3M Financial Statements and Financial Ratios Analyzed from 2015 to 2019

Expert 3M Financial Report & Analysis by Paul Borosky, MBA.

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Hey All,

Thanks for visiting my 3M Financial Report page. On this page, you will be able to find preliminary information about 3M current financial performance as well as some historical track records and trends. 

For a more detailed examination of 3M financial performance, please check out the "Financial Report".  In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:

  • Summarized income statement for the last 5 years.
  • Summarized balance sheet for the last 5 years.
  • Summary analysis by myself of important income statement, balance sheet, and financial ratio trends and other happenings.
  • Five year’s worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
  • Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
  • Professional financial analysis tips provided in each section to help YOU conduct your OWN financial analysis!
  • Each section includes an “in other words” segment.  This is were I use plain English to explain concepts.

Enjoy the preliminary information and for a more detailed analysis, buy the financial report!

Sincerely,

Paul, MBA.

Sample Financial Report

Sample Financial Report by Paul Borosky, MBA.
Financial Report Sample 2

Sample Table of Contents for Financial Reports

Table of Contents

Page Count: 88 Pages

  • Disclaimer 3
    Acknowledgments 4
    Forward 5
    About the Author 7
    Company Summary 8
    Financial Statement Introduction 10
    Income Statement 11
    Walmart’s Income Statement – Summary Analysis 12
    Income Statement Discussion 12
    Balance Sheet 21
    Balance Sheet – Summary Analysis 22
    Balance Sheet Discussion 23
    Financial Ratios 38
    Liquidity Ratios 39
    Liquidity Ratios - Summary Analysis 39
    Liquidity Ratios Discussion 40
    Current Ratio 40
    Quick Ratio 41
    Cash Ratio 42
    Other Liquidity Ratios 42
    Net Operating Working Capital 42
    Asset Ratios 44
    Asset Utilization Ratios - Summary Analysis 45
    Asset Utilization Ratios Discussion 46
    Total Asset Turnover 46
    Fixed Asset Turnover 46
    Days Sales Outstanding 47
    Inventory Turnover 48
    Accounts Receivable Turnover 49
    Accounts Payable Turnover 50
    Other Asset Ratio Calculations 50
    Working Capital Turnover 50
    Average Days in Inventory 51
    Average Days Payable 51
    Profitability Ratios 52
    Profitability Ratios - Summary Analysis 53
    Profitability Ratios Discussion 53
    Return on Assets (ROA) 53
    Return on Equity (ROE) 54
    Profit Margin 55
    Gross Profit Margin 56
    Operating Profit Margin 56
    Basic Earnings Power 57
    ROCE 57
    Capital Employed 58
    Debt Ratios 59
    Walmart’s Debt Ratios - Summary Analysis 59
    Debt Ratios Discussion 60
    Long-Term Debt Ratio 60
    Debt to Equity Ratio 61
    Times Interest Earned 61
    WACC 63
    Book Value of WACC 63
    Free Cash Flow (FCF) 65
    Free Cash Flows – 2016 - 2020 65
    Free Cash Flows – 5 Year Projections 66
    Income Statement – Projections for 5 years 67
    Income Statement – 5 Year Projections 67
    Balance Sheet – Projections for 5 years 68
    Balance Sheet – 5 Year Projections 68
    Company Valuation and Intrinsic Stock Price 70
    Appendix 1: Summarized Income Statement 71
    Appendix 2: Income Statement – Percent of Sales 72
    Appendix 3: Income Statement – Year over Year Growth 73
    Appendix 4: Summarized Balance Sheet 74
    Appendix 5: Balance Sheet as Percent of Total Assets 76
    Appendix 6: Summarized Financial Ratios 77

Contact Us Today to Request a Current 3M Financial Report!

3M - Brief Summary

3M is headquartered in St. Paul Minnesota.  The organization competes in the industrial sector of the economy specifically the specialty industrial machinery.  Currently, 3M employs approximately 96,000 employees.  Important revenue generators for 3M would be safety and industrial equipment, healthcare products, and consumer supplies.

From a financial perspective, 3M has a market capitalization of approximately $91.8 billion.  The organization has a beta of .99.  This indicates that the company has a similar risk factor as compared to the overall market.  The organization's stock price has ranged from $114.04 to $182.55 in the last 52 weeks.  As for their dividend yield, 3M currently offers a 3.69% dividend yield.

3M Financial Report Sources

“3M 2019 Company Analysis… For Beginners: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA. and owner of Quality Business Plan.  In this report, I used 3M's 2018 10k, 2017 10k annual report, 2016 10k annual report, 2015 10k annual report, and 2019 10k annual report as the basis for information gathering. 

 

Section 1: 3M Income Statement Analyzed 2015 to 2019

In this section, I walk through a broad definition as to what an income statement is and why it is important.  From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail.  After each line item is defined and discussed, I finally offer a summary analysis of 3M's important income statement line item trends from 2015 to 2019, in most cases.

3M Revenue Growth.

In 2015, 3M had revenues of approximately $30.2 billion.  In the next year, 3M’s revenue would decrease slightly to $30.1 billion.  In the next three years, the revenues would slowly increase reaching $32.7 billion in 2018 only to fall slightly to $32.1 billion in 2019.  In reviewing the revenues for the company, it seems like the company is holding steady with revenues.  From an investor’s perspective, this should be more than worrisome.  Either company is growing or shrinking.  After holding steady, then one of the two trends is bound to set in.  From this, investors should approach this organization with a healthy dose of risk expected.

3M Summary Income Statement 2019

Column1 2019 2018 2017 2016 2015
Revenues                    32,136                    32,765                    31,657                    30,109                      30,274
COGS                    17,136                    16,682                    16,055                    15,040                      15,383
Gross Profit                    15,000                    16,083                    15,602                    15,069                      14,891
SG&A                      7,029                      7,602                      6,626                      6,222                        6,229
Depreciation                      1,593                      1,488                      1,544                      1,474                        1,435
R & D                      1,911                      1,821                      1,870                      1,735                        1,763
Other                            -                            -                            -                            -                             -
Operating Expenses                    25,962                    25,558                    23,965                    22,886                      23,328
EBIT                      6,174                      7,207                      7,692                      7,223                        6,946
Other Income                         462                         207                         144                         170                           123
Interest Expense                            -                            -                            -                            -                             -
EBT                      5,712                      7,000                      7,548                      7,053                        6,823
Taxes                      1,130                      1,637                      2,679                      1,995                        1,982
Net Income                     4,570                     5,349                     4,858                     5,050                      4,833

Section 2: 3M Balance Sheet Analyzed from 2015 to 2019

For 3M balance sheet, I again go through each important line item from the balance sheet.  In reviewing each line item, I will define their balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019.  Next, I then offer a summary analysis of their important balance sheet line items.

3M Short-Term Investments.

3M had approximately $118 million in short-term investments in 2015.  In the next two years, their short-term investment position would grow to $1.1 billion in 2017.  However, in the next two years, their short-term investment position would fall back to $98 million in 2019.  A positive note about the company’s trend is that they actually do have some short-term investments.  However, in the last three years, 3M has consistently reduced its short-term investment position.  Because of this, investors should expect short-term investments to go the way of the dodo bird in the next few years.  In other words, the revenues don’t start growing, short-term investments may not be part of future balance sheets.

3M Summary Balance Sheet - 2019

Column1 2019 2018 2017 2016 2015
Cash                        2,353                    2,853                    3,053                    2,398                    1,798
Short Term Investment                             98                       380                    1,076                       280                       118
Account Receivable                        4,791                    5,020                    4,911                    4,392                    4,154
Inventory                        4,134                    4,366                    4,034                    3,385                    3,518
Other                              -                         -                         -                         -                         -
Current Assets                    12,971                13,709                14,277                11,726                10,986
Net PPE                        9,333                    8,738                    8,866                    8,516                    8,515
Goodwill                      13,444                  10,051                  10,513                    9,166                    9,249
Other                              -                         -                         -                         -                         -
Total Assets                    44,659                36,500                37,987                32,906                32,718
Accounts Payable                        2,228                    2,266                    1,945                    1,798                    1,694
Accrued Expense                           702                       749                       870                       678                       644
Accrued Taxes                           194                       243                       310                       299                       332
Notes Payable                              -                         -                         -                         -                         -
LT Debt - Current                        2,795                    1,211                    1,853                       972                    2,044
Other                              -                         -                         -                         -                         -
Total Current Liabilities                        9,222                    7,244                    7,687                    6,219                    7,118
LT Debt                      17,518                  13,411                  12,096                  10,678                    8,753
Other                              -                         -                         -                         -                         -
Total Liabilities                    34,533                26,652                26,365                22,563                20,971
Common Stock                        5,907                    5,643                    5,352                    5,061                    4,791
Treasury                      29,849                  29,626                  25,887                  25,434                  23,308
Retained Earnings                      42,135                  40,636                  39,115                  37,907                  36,575
Other                              -                         -                         -                         -                         -
Total Equity                    10,126                  9,848                11,563                10,298                11,708
Total Equity & Liability                    44,659                36,500                37,987                32,906                32,718

Section 3: 3M Financial Ratios Analyzed from 2015 to 2019

For this section, I have chosen several different financial ratios to review for 3M from 2015 to 2019.  In reviewing each of their financial ratios, I first start with defining the financial ratio.  Next, I supply the financial formula for calculating the specific ratio.  Finally, I offer a brief analysis of their important Financial ratios. 

3M Current Ratio.

3M had a current ratio of 1.54 in 2015.  In the next three years, ending 2018, his current ratio position would grow to 1.89.  With 1.0 being the gold standard for current ratio, this shows that the organization has excessive funds in its current asset category.  To mitigate this problem, the organization should invest in long-term projects or increase their dividend payout.

3M Total Asset Turnover.

3M had a total asset turnover in 2015 of .93.  In the next five years, total asset turnover ending 2019 at .72.  This indicates that the company has too many assets that are not generating or increasingly generating revenues for the company.  To mitigate this problem, 3M executives may consider selling off fixed assets or better aligning labor needs with projected revenues. 

3M Return on Assets.

3M had a 14.77% return on assets in 2015.  The organization was able to increase the return on assets to 15.35 in 2016.  However, in the next three years, the organization would continually fall in the return on assets and 2019 with 10.23%.  To mitigate this issue, the organization needs to maintain or grow the revenues while divesting assets.  Assets that may be sold could include buildings or fixed assets.  Further, the company could even improve their return on assets by paying out more dividends.

3M Debt ratio.

3M had a debt ratio of 26.7% in 2015.  In the next five years, the company would continually increase its debt ratio ending 2019 and 39.23%.  As noted previously, 3M’s revenues have remained flat for the last five years.  If the company’s revenues are remaining flat and they are continuously accumulating debt, not only is the organization shooting their perceived risk for solvency through the roof but they are also not making money on the funds borrowed.  Not a great position for the company.

3M Liquidity Ratios 2019

Ratios 2019 2018 2017 2016 2015
Current Ratio                           1.41                    1.89
Cash Ratio                           0.26                    0.39
Quick Ratio                           0.96                    1.29
Net Working Capital                         8,154                  8,981

3M Asset Utilization 2019

Ratios 2019 2018 2017 2016 2015
Total Asset Turnover                           0.72                    0.90
Fixed Asset Turnover                           3.44                    3.75
Days Sales Outstanding                         54.42                  55.92
Inventory Turnover                           7.77                    7.50
Accounts Receivable Turnover                           6.71                    6.53
Working Capital Turnover                           3.94                    3.65
AP Turnover                         14.42                  14.46
Average Days Inventory                           0.02                    0.02
Average Days Payable                           0.04                    0.04

3M Profitability Ratios

Ratios 2019 2018 2017 2016 2015
Return on Assets 10.23% 14.65%
Return on Equity 45.13% 54.32%
Net Profit Margin 14.22% 16.33%
Gross Profit Margin 46.68% 49.09%
Operating Profit Margin 19.21% 22.00%
Basic Earning Power 13.82% 19.75%
ROCE 17.42% 24.63%
Capital Employed                       35,437                29,256
ROIC 28.32% 31.16%

3M Long-term Debt 2019

Ratios 2019 2018 2017 2016 2015
Debt Ratio 39.23% 36.74%
Debt/Equity 173.00% 136.18%
Times Interest Earned