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Shares of diversified conglomerate 3M Company (MMM - Analyst Report) hit a new 52-week high of $143.74 on Jun 5, 2014, before closing the trading session a notch lower at $143.71. This translates to a healthy one-year return of 32.2%.

3M’s share price has been on a steady uptrend since Feb 2014. Despite its strong price appreciation, this Zacks Rank #3 (Hold) stock still has enough fundamentals that may further drive its price upward. The stock is currently trading at a forward P/E of 19.1x and has a long-term earnings growth expectation of 11.3%.

Growth Drivers

Global credit rating firm Moody's Corporation (MCO - Analyst Report) recently assigned an investment grade Aa2 rating and a stable outlook for $1.1 billion of unsecured debt issue by 3M. The debt rating reflects 3M's strong competitive position across an extensive range of markets, robust operating profitability, stable free cash flow and a relatively conservative capital structure.

3M has been focusing on restructuring initiatives to transfer capital from low-margin businesses to more lucrative opportunities, thus generating better return on capital. Furthermore, the company’s continued investment in research and development enables it to generate organic growth by innovating products and applications that capture premium pricing in early stages of their life-cycle. This enables the company to consistently improve its margins and capitalize on its brand value. The rating was also accompanied by a stable outlook, reflecting broad-based expectations of resilient levels of profitability and free cash flow across business cycles.

Portfolio management, investment in innovation, and business transformation are the three key levers on which the company intends to focus on moving forward. 3M recently increased its tally for global patents past the 100,000 mark. The company boasts of a 50,000 deep product line ranging from medical adhesives to reflective traffic signs to films that enhance liquid crystal displays. It also has 22,800 registered patents.

With a steady stream of innovative products, 3M expects earnings in 2014 to be in the range of $7.30 to $7.55 per share with organic local currency sales growth of 3% to 6% despite a challenging macroeconomic environment. We remain bullish on the stock and expect it to further move northwards.

Other Stocks to Consider

Other stocks that look promising and are worth a look now include CLARCOR Inc. (CLC - Snapshot Report) and Icahn Enterprises, L.P. (IEP), both carrying a Zacks Rank #1 (Strong Buy).

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