By: Dividend Sensei
3M crashed 10% on August 27th on news that its legal maneuver to neutralize its earplug liabilities was rejected by a Federal judge. It’s appealing the decision.
The legal overhang could last for years, though the final settlement will almost certainly be far below the worst-case scenarios.
3M’s investment thesis remains intact but it isn’t likely to return to fair value for quite some time.
3M is 38% historically undervalued, trading at 9.2X cash-adjusted earnings, and could deliver 17% annual returns within 5 years and 12.2% annual returns long term.
Here are 3 superior high-yielding blue-chip alternatives with higher safe yields, and greater long-term return potential.
Buying all three together (or combined with 3M) results in lower fundamental risk, superior returns, lower volatility, and can help you sleep well at night in all economic and market conditions.