Thursday's report from RBC Capital Markets showcased a selection of companies that have made significant strides or faced challenges in 2024. The 'Nice List' includes Carrier Global Corporation (NYSE:CARR), which successfully completed five major divestitures, transitioning effectively into a pure-play HVAC company.
nVent Electric plc (NYSE:NYSE:NVT) also earned a spot by narrowing its focus through strategic divestitures and acquisitions, notably quadrupling its liquid cooling capacity. Mueller Water Products, Inc. (NYSE:NYSE:MWA) saw its stock rise by 72% year-to-date after smoothly ramping up its new brass foundry and meeting high service brass demand.
Gates Industrial Corporation plc (NYSE:NYSE:GTES) is recognized for its resilience over a challenging three-year period, which included ten sponsor sell-downs, and its initiatives that are expected to expand margins by 400 basis points through 2026. Trane Technologies plc (NYSE:NYSE:TT) was commended for consistently delivering growth and strong commercial HVAC performance across its verticals in 2024.
Conversely, the 'Naughty List' features 3M Company (NYSE:NYSE:MMM), which faced the unfortunate situation of having to cut its dividend, ending a 64-year streak of increases and losing its status as a Dividend Aristocrat. Despite this setback, InvestingPro data shows MMM has delivered a remarkable 46.9% YTD return, with current dividend yield at 2.16%. The company maintains a market cap of $70.63B and generates annual revenue of $32.64B.
According to InvestingPro's analysis, MMM currently appears fairly valued, with a FAIR Financial Health score of 2.44. Honeywell International Inc. (NYSE:NASDAQ:HON) appears on the list for resisting the sector-wide trend towards demerging and simplifying their portfolio, which has led to vulnerability to activist pressure.
Atkore Inc. (NYSE:ATKR) surprised the market with a third-quarter disclosure of increased competition from Mexico in the electrical steel conduit market, causing concern among investors.
Lastly, Fortive Corporation (NYSE:NYSE:FTV) was noted for potentially confusing the market with its spinoff announcement that excluded Fluke and did not address portfolio cohesiveness issues. These insights provide a snapshot of how certain multi-industry companies have navigated the challenges and opportunities presented in the year 2024.
In other recent news, 3M Company has reported significant financial developments. The company recorded an 18% rise in non-GAAP earnings per share and a 1% organic revenue growth in the third quarter, leading to an upward revision of the full-year EPS guidance.
Despite these positive developments, 3M faces substantial challenges, including a $3.6 billion legal settlement paid during the quarter and unresolved liabilities related to per- and polyfluoroalkyl substances (PFAS).
In addition to these financials, 3M also returned $1.1 billion to shareholders through dividends and share repurchases, and generated a free cash flow of $1.5 billion for Q3. However, the company's consumer segment experienced a slight decline due to portfolio prioritization and price-sensitive retail customers.
Despite these potential headwinds, 3M maintains a positive outlook with strategies focusing on organic growth and strategic divestitures. More details about the company's financial outlook and strategies will be shared at the upcoming Investor Day in February 2025.
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