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3M vs. Honeywell: Which Industrial Conglomerate is a Stronger Pick?
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Key Takeaways
3M's Safety and Industrial organic sales rose 8.2% in Q2, backed by adhesives, safety and electrical demand.
Honeywell's Building Automation organic sales grew 9%, while Process Automation and Technology fell 1%.
MMM trades at 17.52X forward earnings, which is lower than HON's 21.91X.
3M Company (MMM - Free Report) and Honeywell Technologies (HON - Free Report) are two prominent names operating in the Zacks Diversified Operations industry. As rivals, both companies compete in multiple sectors with significant overlap in industrial automation, consumer goods, and safety and security markets.
With considerable exposure to diverse markets, both companies invest heavily in research and development to innovate new products, drive growth and gain market share. But which one is a stronger pick today? Let’s take a closer look at their fundamentals, growth prospects and challenges to make an informed choice.
The Case for 3M
3M has been witnessing solid momentum in the Safety and Industrial segment, driven by strength in industrial specialties, electrical and personal safety markets. Stable demand for electrical infrastructure products like medium voltage cable accessories and insulation tapes augurs well for the segment in the quarters ahead. Also, new product launches and an increase in demand for industrial adhesives and electronics bonding solutions bode well for it.
Within the segment, sales in industrial adhesives and tapes climbed 13%, while personal safety sales advanced 9.4% year over year in second-quarter 2026. Electrical and industrial specialties markets also posted strong growth of 12% and 10.9% in the quarter, respectively. The Safety and Industrial segment’s organic sales improved 8.2% year over year in the second quarter.
Strong momentum across semiconductor, data center, aerospace and commercial branding markets, supported by solid demand for products and broader sales coverage, is driving the Transportation & Electronics segment’s performance. In the second quarter, the segment’s organic revenues increased 5.9% year over year. Backed by strength across its businesses, 3M provided a positive outlook. For 2026, it expects total adjusted organic sales to grow more than 3.5% on a year-over-year basis.
3M is committed to rewarding its shareholders handsomely through dividend payments and share buybacks. In the first six months of 2026, the company rewarded its shareholders with $813 million in dividends and $3 billion in buybacks. Also, in 2025, it paid dividends worth $1.6 billion and repurchased shares for $3.2 billion. Exiting the second quarter, the company had $1.8 billion remaining under the share repurchase program. In February 2026, it hiked its quarterly dividend by 6.8%.
Despite the positives, weakness in the consumer retail end markets, led by lower consumer discretionary spending, remains a persistent concern. This is reflected in the Consumer segment’s results, which declined 2.1% in the second quarter. There was a particular weakness in packaging & expression and home improvement businesses.
The Case for Honeywell Technologies
Honeywell has been benefiting from strength in its Building Automation segment. An increase in demand for its products and solutions, led by increasing building projects across the Americas, India and the Middle East, is aiding the segment. In the second quarter of 2026, the segment’s organic sales increased 9% year over year.
Strength in the Industrial Automation segment, driven by favorable utilities project timing and growth in the sensing and industrial measurement business, also bodes well for HON. The segment’s organic revenues increased 4% year over year in the second quarter. Exiting the second quarter, Honeywell’s (excluding Aerospace unit) backlog was approximately $19.6 billion. For 2026, Honeywell expects overall revenues to be in the $19.8-$20.0 billion range, with organic revenues expected to be up 3-4% on a year-over-year basis.
HON intends to strengthen and expand its businesses through acquisitions. In July 2026, it acquired Johnson Matthey's Catalyst Technologies Business. The inclusion of Johnson Matthey's Catalyst Technologies unit enabled Honeywell to strengthen its portfolio across refining, petrochemicals and renewable fuels.
Strong free cash flow generation supports the company’s shareholder-friendly activities. Honeywell (excluding Aerospace unit) generated $456 million of free cash flow in the second quarter, up from $114 million a year earlier. For 2026, it expects operating cash flow of approximately $2.1 billion and free cash flow of approximately $2 billion.
However, Honeywell has been witnessing weakness in the Process Automation and Technology segment. In second-quarter 2026, the segment’s organic revenues decreased 1% year over year. This decline was attributable to a 6% drop in organic sales in the aftermarket business owing to lower refining catalyst shipments. Apart from this, the company’s highly leveraged balance sheet remains another concern.
How Does the Zacks Consensus Estimate Compare for MMM & HON?
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MMM’s 2026 sales and earnings per share (EPS) implies year-over-year growth of 4.6% and 11.2%, respectively. The EPS estimates for both 2026 and 2027 have increased over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for HON’s 2026 sales and EPS implies a year-over-year decline of 49.6% and 57.6%, respectively. Its worth noting that the year-over-year decline in projections is due to the impact of the Aerospace business spin-off. While Honeywell’s EPS estimates for 2026 have increased, the estimates for 2027 have declined over the past 60 days.
Price Performance and Valuation of MMM & HON
Image Source: Zacks Investment Research
Following the spin-off of the Aerospace business, Honeywell’s shares have lost 7%, while 3M stock has gained 3.1% over the same period.
Image Source: Zacks Investment Research
3M is trading at a forward 12-month price-to-earnings ratio of 17.52X, while Honeywell’s forward earnings multiple sits higher at 21.91X.
MMM or HON: Which is a Better Pick?
3M’s strength in the safety, industrial, transportation and aerospace markets, along with its focus on product innovation, is likely to drive its long-term performance. In contrast, HON’s strength in the industrial and building automation markets has been dented by the weakness in its process automation segment.
Both the diversified industrial companies currently carry a Zacks Rank #2 (Buy). This makes choosing one stock a difficult task. Considering their long-term prospects, revenue and margin projections, MMM seems to have an edge over HON currently. While MMM carries a VGM of D, HON has a VGM of F.
View the Zacks #1 Rank List
Image: Bigstock
3M vs. Honeywell: Which Industrial Conglomerate is a Stronger Pick?
Key Takeaways
3M Company (MMM - Free Report) and Honeywell Technologies (HON - Free Report) are two prominent names operating in the Zacks Diversified Operations industry. As rivals, both companies compete in multiple sectors with significant overlap in industrial automation, consumer goods, and safety and security markets.
With considerable exposure to diverse markets, both companies invest heavily in research and development to innovate new products, drive growth and gain market share. But which one is a stronger pick today? Let’s take a closer look at their fundamentals, growth prospects and challenges to make an informed choice.
The Case for 3M
3M has been witnessing solid momentum in the Safety and Industrial segment, driven by strength in industrial specialties, electrical and personal safety markets. Stable demand for electrical infrastructure products like medium voltage cable accessories and insulation tapes augurs well for the segment in the quarters ahead. Also, new product launches and an increase in demand for industrial adhesives and electronics bonding solutions bode well for it.
Within the segment, sales in industrial adhesives and tapes climbed 13%, while personal safety sales advanced 9.4% year over year in second-quarter 2026. Electrical and industrial specialties markets also posted strong growth of 12% and 10.9% in the quarter, respectively. The Safety and Industrial segment’s organic sales improved 8.2% year over year in the second quarter.
Strong momentum across semiconductor, data center, aerospace and commercial branding markets, supported by solid demand for products and broader sales coverage, is driving the Transportation & Electronics segment’s performance. In the second quarter, the segment’s organic revenues increased 5.9% year over year. Backed by strength across its businesses, 3M provided a positive outlook. For 2026, it expects total adjusted organic sales to grow more than 3.5% on a year-over-year basis.
3M is committed to rewarding its shareholders handsomely through dividend payments and share buybacks. In the first six months of 2026, the company rewarded its shareholders with $813 million in dividends and $3 billion in buybacks. Also, in 2025, it paid dividends worth $1.6 billion and repurchased shares for $3.2 billion. Exiting the second quarter, the company had $1.8 billion remaining under the share repurchase program. In February 2026, it hiked its quarterly dividend by 6.8%.
Despite the positives, weakness in the consumer retail end markets, led by lower consumer discretionary spending, remains a persistent concern. This is reflected in the Consumer segment’s results, which declined 2.1% in the second quarter. There was a particular weakness in packaging & expression and home improvement businesses.
The Case for Honeywell Technologies
Honeywell has been benefiting from strength in its Building Automation segment. An increase in demand for its products and solutions, led by increasing building projects across the Americas, India and the Middle East, is aiding the segment. In the second quarter of 2026, the segment’s organic sales increased 9% year over year.
Strength in the Industrial Automation segment, driven by favorable utilities project timing and growth in the sensing and industrial measurement business, also bodes well for HON. The segment’s organic revenues increased 4% year over year in the second quarter. Exiting the second quarter, Honeywell’s (excluding Aerospace unit) backlog was approximately $19.6 billion. For 2026, Honeywell expects overall revenues to be in the $19.8-$20.0 billion range, with organic revenues expected to be up 3-4% on a year-over-year basis.
HON intends to strengthen and expand its businesses through acquisitions. In July 2026, it acquired Johnson Matthey's Catalyst Technologies Business. The inclusion of Johnson Matthey's Catalyst Technologies unit enabled Honeywell to strengthen its portfolio across refining, petrochemicals and renewable fuels.
Strong free cash flow generation supports the company’s shareholder-friendly activities. Honeywell (excluding Aerospace unit) generated $456 million of free cash flow in the second quarter, up from $114 million a year earlier. For 2026, it expects operating cash flow of approximately $2.1 billion and free cash flow of approximately $2 billion.
However, Honeywell has been witnessing weakness in the Process Automation and Technology segment. In second-quarter 2026, the segment’s organic revenues decreased 1% year over year. This decline was attributable to a 6% drop in organic sales in the aftermarket business owing to lower refining catalyst shipments. Apart from this, the company’s highly leveraged balance sheet remains another concern.
How Does the Zacks Consensus Estimate Compare for MMM & HON?
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MMM’s 2026 sales and earnings per share (EPS) implies year-over-year growth of 4.6% and 11.2%, respectively. The EPS estimates for both 2026 and 2027 have increased over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for HON’s 2026 sales and EPS implies a year-over-year decline of 49.6% and 57.6%, respectively. Its worth noting that the year-over-year decline in projections is due to the impact of the Aerospace business spin-off. While Honeywell’s EPS estimates for 2026 have increased, the estimates for 2027 have declined over the past 60 days.
Price Performance and Valuation of MMM & HON
Image Source: Zacks Investment Research
Following the spin-off of the Aerospace business, Honeywell’s shares have lost 7%, while 3M stock has gained 3.1% over the same period.
Image Source: Zacks Investment Research
3M is trading at a forward 12-month price-to-earnings ratio of 17.52X, while Honeywell’s forward earnings multiple sits higher at 21.91X.
MMM or HON: Which is a Better Pick?
3M’s strength in the safety, industrial, transportation and aerospace markets, along with its focus on product innovation, is likely to drive its long-term performance. In contrast, HON’s strength in the industrial and building automation markets has been dented by the weakness in its process automation segment.
Both the diversified industrial companies currently carry a Zacks Rank #2 (Buy). This makes choosing one stock a difficult task. Considering their long-term prospects, revenue and margin projections, MMM seems to have an edge over HON currently. While MMM carries a VGM of D, HON has a VGM of F.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.