3M shares under pressure: Analysts are critical of the spin-off of the healthcare division

3M shares under pressure: Analysts are critical of the spin-off of the healthcare division

Phew, after the first upward jump after the numbers, 3M's price has been under pressure again for several trading days. Investors apparently doubt how sustainable the latest results are. There are lots of uncertainties. But what concerns the analysts who regularly follow the company? Scott Davis, head of the analysis company Melius Research, asked the first question in the analyst call about the numbers. He started with praise: "I haven't been able to say this for a long time, but overall it was a pretty solid, well-rounded quarter, so some progress." But he wanted to go back a little. “What are the remaining steps to complete the spin-off of the healthcare division?” asked Davis. “Are there still major hurdles?” 3M CEO Mike Roman responded that the team continues to make “very good progress.” There are no hurdles to be seen. The last communicated schedule was confirmed by Roman.

Postponed to 2024
Background: 3M has been planning to spin off its relatively profitable healthcare division for some time. The healthcare area was originally supposed to be spun off at the end of 2023 or beginning of 2024. However, there was then a postponement with the target of the first half of 2024. Reason: The new 3M boss in the healthcare sector, Bryan Hanson, who only took office on September 1st, should still be able to get used to it a bit.

According to a report by www.deraktionaer.de, postponing the spinoff of 3M's healthcare division to 2024 could have market, consumer and industry implications. 3M's healthcare division is relatively profitable, and spinning it off could create additional near-term value for investors. On the other hand, skeptics may fear that 3M's decades-long history of annual dividend increases could be jeopardized by this move. Analysts have recently reacted cautiously.

The exact impact on the market is difficult to predict. It is possible that the postponement of the spin-off could lead to uncertainty among investors, which could lead to further pressure on 3M's share price. On the other hand, the successful implementation of the spin-off could strengthen investor confidence and lead to positive share price development.

For consumers, the spin-off of the healthcare division could have an impact on the range of medical products and services. It is possible that 3M's focus on other areas following the spinoff will impact the availability and quality of medical products.

In the industry, the spin-off of 3M's healthcare division could lead to changes in the competitive landscape. New companies could enter the market or existing companies could strengthen their position. This could lead to increased competition and innovation, which could ultimately benefit consumers.

Overall, it remains to be seen how the postponement of the healthcare division spin-off will impact the market, consumers and the industry. There are both positive and negative effects that only time will tell.