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Friday, July 07, 2006

3M's Warning Hitting the Market

Stock Tickers: MMM, GE

If you thought the jobs numbers were important this morning, take a guess what an earnings trimming by 3M (MMM) does to the DJIA. S&P and DJIA futures have now fallen into negative territory as 3M is the second largest international diversified manufacturing conglomerate in the US behind General Electric (GE).

3M updated guidance this morning by saying EPS would be $1.14 to $1.17, with consensus estimates at $1.17; but that includes $0.08 to $0.10 gains from tax adjustments. It said revenues would be $5.7 Billion, versus a $5.72 Billion estimate. The company is saying sales volumes are running under plan and that organic dollar adjusted sales growth is running at the lower-end of a 5% to 8% prior range.

A lot of this is actually being blamed on optical film sales being lower and inventories increasing for altering LCD viewing. Corning (GLW) is the most leveraged name to LCD sales.

MMM is now trading down 6.6% at $75.98 and GE is now trading down 0.3% tp $33.40 in pre-market trading. GLW is now down over 3% to $22.45 in pre-market trading.

Jon C. Ogg
July 7, 2006
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