Golden “Scotch” 2018: the bright future of 3M!

The second week of the US stock market reporting continues. And in this article someone will get acquainted with, and someone will consider more closely the company with more than 140 billion USD capitalization – 3M. And it’s so hard to imagine that it all started with a banal tape – sticky tape, back in the early twentieth century.

3M (Three Mills, NYSE: MMM, formerly Minnesota Mining and Manufacturing Company) is an American diversified innovation and production company. Headquarters – in the city of St. Paul, Minnesota (USA).

The company was founded in 1902 in the US in Minnesota near the prosperous village on the shore of Lake Superior by five entrepreneurs in order to use a rare mineral corundum as an abrasive: a lawyer, a doctor, two railway managers, and a butcher.

Scotch Tape

Scotch adhesive tape was invented by Richard Drew, who worked in the 1920s as a laboratory assistant in the company. During tests of samples of sandpaper in car repair shops, Richard accidentally pointed out that when painting cars, protecting the unpainted parts is a rather difficult task. This observation led Richard to the idea of ​​creating a special painting tape. Customers called the new product “Scotch”, which means “stingy”, “economical”. When in 1925 an improved adhesive tape with a sufficient amount of glue appeared, the company called it Scotch. It was then that the world-famous trade mark was born. In 1930, it was officially registered.

Today, the company’s enterprises in 60 countries of the world produce more than 50 thousand items for medicine and various industries, including automobile, oil and gas, mining, etc. (abrasive, adhesive materials, etc.).

(WIKIPEDIA)

Every time I look at a set of different little things at my desk, I understand how truly a short way from small to great.

Well, let’s loot at basics

Analyzing the price chart of the company’s 3M shares (Figure 1), you realize that there is a real American dream in the stock market.

Even after the global crisis of 2008, this company, having received a serious blow “under the breath”, managed to deal with the problems and just soared to the horizons of financial success. For almost 10 years raising the value of shares from 40 USD to their current value of 247-248 USD, the management of this company boldly deserves a place in the hall of fame of the heroes of Wall Street.

Technical analysis of the daytime timeframe indicates an upward consolidation, in the form of a “wedge,” with a possible continuation of growth and an insignificant level of possible correction.

Before we proceed to concrete examples of transactions, there is still a little more fundamental analysis.

The publication of the report is January 25, 2018.

Expected figures: EPS 2.01 USD; Income of 7.85 billion USD.

At the moment, the shares of this company are in the set-five “must have”, on the recommendations of most of the worthy analysts from Wall Street.

After going through a number of effective restructurings during the last 10 years, the company does not stand still and continues to move further, increasing its production potential, creating new brands in different industries and, in a word, torn to the top.

Even in the case of a not very positive report, with a deviation from the forecast, the gradual reversal with the continuation of the upward trend is more likely to be. So for the next year, according to these shares, the trade recommendation is unambiguous:

STRONG BUY and HOLD

For a more convenient trade on CFD on 3M shares, I propose to take a look at the right side of Figure 1.

We observe the levels of the desired entry to buy, and the following examples of transactions are based on them:

• conservative option:
  BUY limit 243.50, SL 241.50, TP 250.00
  BUY limit 235.50, SL 233.50, TP 240.00
  BUY limit 227.00, SL 223.00, TP 231.00
• aggressive option:
  BUY (from the market opening position), SL 233.50, TP 250.00
  BUY limit 235.50, SL 233.50, TP 240.00

To reduce possible risks in aggressive trading, and also to ensure a high and stable result with conservative management of capital, it is necessary to work clearly and with understanding on the volume of transactions.

If you need to deal with this part of Money Management, you can e-mail me to support@esterholdings.com with subject “for Andrew Green”, as well as one of our individual training courses.

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Try and stumble, but keep walking. We have the right to make mistakes, but we do not have the right to inaction.

Andrew Green