Ticker Reports for March 3rd
3M to Hit $175 by Mid-Year, and Higher Highs Are Likely
The market for 3M (NYSE: MMM) stock is on fire, with shares rising by 7% in the final week of February and 65% in the preceding 12 months, and there is more upside ahead. The strong technical indicators point to a move to $175, possibly higher by midyear. The reason is simple: this once-Dividend King is back in action with its legal troubles behind it and business growth in the forecast.
The business highlights from 2024 include a rapidly improving balance sheet and capital return outlook, including investor-attracting distribution increases and share-count-reducing buybacks. The takeaway is that market fears have been alleviated, and the premium this stock deserves is getting priced in and may result in a new all-time high for this industrial stock by year’s end.
3M Benefits From a Bullish Analyst Sentiment Shift
The analysts' sentiment trends reflect a significant change in market attitude. The trends include a 60% increase in coverage to 16 analysts since the low in April 2024, firming sentiment with consensus up from Hold with a bearish bias to Moderate Buy with a bullish bias, and a rising price target. The Moderate Buy rating has a bullish bias because 67% rate the stock at Buy or higher with no end to the upgrade cycle in sight.
The price target is significant because it assumes fair value at the March open after rising 40% in 12 months, and a move into the high-end range is likely. That puts this market at a nearly decade high and on track to retest the all-time high soon after.
The insiders are selling 3M shares, but this isn’t a problem. They benefit from share-based compensation and have been stalwart holders. They only sold into the rally after the stock price reclaimed multiyear high price points, and institutional activity offsets this.
The institutional activity is noteworthy because the group sold on balance in Q2 and Q3 of 2024, then reverted to buying in Q4 and ramped their buying activity to a six-quarter high in Q1 2025, aligning with the shift in analysts' sentiment. They own about 65% of the stock and provide a strong tailwind for the market.
The capital return is solid and improving in both quality and size, a driving force for sell-side investors. The company’s combined dividend distribution and share repurchases amounted to $3.8 billion in F2024, about 77% of the free cash flow, and the guidance for 2025 is better.
The company is guiding for $5.25 billion in FCF at the mid-point, putting the capital return, if left unchanged in 2025, at 71%. The dividend is attractive, with a 1.85% and positive outlook for annual distribution growth; the share repurchase is also appealing, ramping at year’s end to reduce the count by 1.6% compared to Q4 2023 and expected to remain strong in 2025.
3M Reverts to Growth in Q4 2024
3M’s Q4 results and guidance for 2025 were not robust and included the impact of its divestiture in 2024 but showed the company turning a corner. Highlights include a return to growth in ongoing operations driven by organic gains and an expectation for increased traction in 2025. The forecast is for roughly 1% growth in ongoing business and improved margins and cash flow as the impact of legal settlements dwindles in the rearview mirror. In the long term, 3M is forecasted to sustain mid-single-digit top and bottom-line growth through 2030 with modest acceleration.
The technical action in MMM stock is very bullish, showing a Bullish Triangle on the weekly chart and a Bullish Flag Pattern on the monthly. These patterns suggest a move to $180 is likely, and a higher is probable because of the business, analysts, and institutional trends. The questions are if the 3M market will enter a consolidation once it reaches $180 and how long it will last, or if the rally will continue on the all-time high quickly.
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These 3 Tech Stocks Are Gaining Steam After NVIDIA's Report
Wall Street analysts and traders alike earn their pay by connecting the dots in the stock market. This includes knowing that when there is one big winner, a suit of associated stocks could soon follow. In today’s market, it is clear to most that the technology sector has gotten most of the attention—and capital—from investors, with a specific interest in the artificial intelligence and semiconductor spaces.
Knowing that NVIDIA Co. (NASDAQ: NVDA) leads the pack in this dynamic, investors can either follow the masses behind this massive company and its financial results in the future or connect the dots and get a much better risk-adjusted return. In other words, shareholders in similar stocks might experience strong gains with less volatility.
That is exactly where today’s list of lateral players comes into play, riding on NVIDIA’s tailwinds and the artificial intelligence race as a whole. Stocks like Dell Technologies Inc. (NYSE: DELL), Oracle Co. (NYSE: ORCL), and even Taiwan Semiconductor Manufacturing Co. (NYSE: TSM) all play a vital role in the development of artificial intelligence. Some could even say that they also play a vital role in NVIDIA’s continued success.
Recent Optimism Boost For Taiwan Semiconductor
Some on Wall Street decided that waiting for NVIDIA was not the most effective use of their time and capital. They expressed the view that the market leader would have a pretty bullish quarterly announcement to make, therefore boosting Taiwan Semiconductor’s demand and production as well.
Knowing that the odds are now stacked in favor of the bulls, there are more signs showing up in this stock pointing to potentially higher prices ahead, something investors can see through the current 9.0% collapse in short interest over the past month, a clear sign of bearish capitulation today.
Be that as it may, these weren’t the only players on Wall Street to express such an optimistic view of Taiwan Semiconductor. Analysts from Barclays decided to reiterate their Overweight ratings on the chipmaker and keep a $255 price target on it, implying the stock can still deliver a net rally of up to 16% from where it trades today.
Now, considering valuation metrics, Taiwan Semiconductor trades at a much lower price-to-earnings (P/E) ratio of 23.0x, which would give value investors a chance to cap the potential downside compared to NVIDIA’s valuation of 41.0x P/E today, fitting the definition of a better risk-adjusted return mentioned earlier.
Dell Stock Quietly Brewing Double-Digit Upside
Through a partnership with NVIDIA’s artificial intelligence capabilities, Dell has started to float both its hardware and software offers to develop new platforms and services created from this advancement in technology. What that means for investors is simple: Dell’s upside has been renewed quietly, so there’s a chance to tap into it before the masses get a hold of it.
According to analysts from Bank of America, that upside looks more like a 40% rally from today’s prices. They reiterated their Buy rating on Dell stock as of February 2025 alongside a valuation of $150 per share. Now, the stock did decline in their most recent quarterly earnings announcement, giving back up to two points on the price despite an earnings beat.
Through the company’s investor presentation for the quarter, it becomes evident that the financials are as good as ever, expecting enough growth to keep the stock going, though the only excuse is that this growth is not up to what the markets had been expecting, being under the impression that only NVIDIA-like growth is acceptable today.
Institutions Chose Oracle Stock
Oracle stock is a vital player in the artificial intelligence development of NVIDIA’s chips since it provides the cloud computing platform under which these chips can shine by training the computing models that the whole market seems to be after today.
Investors can see this connection at play through the 20.5% boost in holdings from institutional buyers at UBS Asset Management, who, as of February 2025, have built up a stake worth as much as $2.3 billion in a bet that this NVIDIA supplier has got to see higher prices ahead.
By trading at only 83% of their 52-week highs, Oracle shares start to fit into this risk-adjusted return area for investors looking for upside in their portfolios. This is especially true when they consider the recent Market Outperform rating just reiterated by analysts at JMP Securities, who also valued the stock as high as $205 per share.
From today’s price, this valuation would call for up to 13% upside, not to mention a new 52-week high, which could potentially start to drive in further momentum buyers, who systematically buy stocks that break out near or past these important price levels.
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These S&P 500 Stocks Have Low P/E Ratios — Time to Buy?
Purchasing stocks at the right time can maximize your return on investment, especially if you plan to buy and hold shares toward a short-term or medium-term financial goal. A stock’s P/E ratio can give you an immediate idea of whether a stock is trading at, below or above fair value.
While the average P/E ratio varies by industry, most analysts consider a stock with a P/E ratio below 25 to be potentially undervalued by the market.
As the S&P 500 comes off its worst trading week of the year, a few of the index’s biggest names are showing rare low P/E values. Let’s take a look at four companies trading in the S&P 500 with P/E ratios that may indicate buying opportunities.
Merck & Co. Offers a Billion-Dollar Market Cap, Sub-15 P/E Ratio
U.S.-based pharmaceutical giant Merck & Co., Inc. (NYSE: MRK) took a sharp hit to its share price in late February, trading near a 52-week low price of less than $90 per share. When combined with its $1.72 EPS and $226 billion market capitalization, Merck & Co. currently carries a competitive P/E ratio of 13.28.
Analyst estimates indicate that stock experts generally agree this slump in share price is a temporary phenomenon. The company maintains a Moderate Buy rating, with an anticipated potential upside of 30% from its current trading price. Short interest trends support this assertion, with interest rates falling by more than 13% since last month. Signs could point to a rebound for MRK coming soon when combined with increasing institutional investments.
Verizon Communications Brings Rock-Bottom P/E Ratio, Strong Dividend
Another stock that’s had a rough year in terms of share price, Verizon Communications (NYSE: VZ) has seen just an 8.3% increase in share price since last year. Despite this, analysts predict a 6.66% potential upside and expected earnings growth of 3.62% at the same time. This gives Verizon a P/E ratio of 10.44, which is considered exceptionally low compared to other telecommunications stocks.
This lower per-share trading value could be related to insider sales activity. In the last three months, insiders have sold more than $2 million in stock. However, institutional activity tells a different story; institutional investors purchased $7.4 billion in VZ stock last quarter compared to $3.32 billion sold.
Value investors looking for long-term income-generating stocks may be particularly interested in exploring Verizon while its P/E ratio is low. The company offers a 6.27% dividend yield, which is competitive with top income-generating sectors like REITs and energy. It also has a 20-year history of dividend increases, making it a strong pick to keep up with inflation.
Exxon Mobil Generates a Strong Potential Upside, Increasing Earnings Growth
With a Moderate Buy consensus rating and a 17.43% anticipated upside, analysts are expecting a big year for Exxon Mobil (NYSE: XOM). However, what analysts expect from EPS data is even more impressive than price estimates. Analysts predict a massive 21.40% increase in earnings from the company through 2025 despite missing its most recent earnings estimate by $0.10 per share.
While XOM’s share price is higher than the other picks on our list, at about $110 per share, the company still maintains a competitive P/E ratio of 14.04. Insider buying beat out selling, with $14 billion in shares bought versus $9.52 billion sold, another indicator of increasing analyst confidence.
Exxon Mobil can be another strong long-term hold for dividend investors looking to generate long-term, stable income through retirement. While its dividend yield is lower than Verizon at 3.60%, Exxon Mobil has increased its dividend payment for the previous 42 years for an annualized three-year growth rate of 3.24%. This predictable, consistent annual dividend increase of about 1% can mean good things long-term for investors.
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