3M’s narrower focus will pay off

Article Excerpt

Industrial and consumer products giant 3M has now completed the merger of its food safety operations with Neogen. The deal is part of 3M’s strategy to focus on its more-promising businesses. The next step will come in 2023 when it spins off its Health Care operations as a separate firm. We feel these moves improve 3M’s long-term prospects. We also like the outlook for the new Neogen, but we suggest holding off on new buying until its merged operations are integrated. 3M COMPANY $129 is a buy. The company (New York symbol MMM; Manufacturing & Industry sector; Shares outstanding: 571.1 million; Market cap: $73.7 billion; Dividend yield: 4.6%; Takeover Target Rating: Medium; www.3m.com) produces more than 60,000 items, including air purifiers, adhesives, bandages and components for medical devices. On September 1, 2022, the company merged its Food Safety business with Neogen (see right) in a split-off transaction. 3M investors that opted to participate now hold 50.1% of the combined firm, with Neogen shareholders holding 49.9%. As part…