Benzinga | Jul 27, 2021 11:13AM EDT

Post-it Maker 3M Stock Gains After Crushing Q2 Earnings, Raised FY21 Outlook

* 3M Co (NYSE:MMM) reported second-quarter sales growth of 24.7% year-over-year to $8.9 billion with organic local-currency sales growth of 21.4%, beating the consensus estimate of $8.55 billion.

* Sales increase by segments: Transportation and Electronics +28.1% Y/Y, Health Care +24.9% Y/Y, Safety and Industrial +22.4% Y/Y, and Consumer +20.4% Y/Y.

* Adjusted EPS improved by 44% Y/Y to $2.59, beating the consensus estimate of $2.26.

* The operating margin declined by 223 bps to 22%.

* Adjusted EBITDA increased by 28.6% Y/Y to $2.44 billion, and margin expanded by 82 bps to 27.3%.

* 3M generated an operating cash flow of $1.9 billion with an adjusted free cash flow of $1.6 billion for Q2, contributing to an adjusted free cash flow conversion of 103%.

* FY21 Outlook: 3M expects reported total sales growth of 7% to 10% with organic local-currency sales growth of 6% to 9% (up from prior guidance of total sales growth of 5% to 8% with organic local-currency growth of 3% to 6%).

* It expects EPS of $9.70 - $10.10 (prior expectation of $9.20 to $9.70) vs. a consensus estimate of $9.81.

* 3M anticipates free cash flow conversion of 90% to 100% versus a previous 95% to 105%.

* Price Action: MMM shares are up 1.15% at $203.99 during the premarket session on the last check Tuesday.

* Photo by Gerd Altmann from Pixabay