3M Company (MMM) invested in a Berlin, Germany based innovative eReading technology company, txtr GmbH. The investment was made by the company through its 3M New Ventures and 3M Electro & Communications Business. The terms of the transaction were not disclosed.
With the development of eReading techniques, people will be able to access documents and books wherever they are. 3M innovated a number of technologies for vertical markets such as the educational sector, the library business and the automotive industry. txtr presents elevated innovation speed, advanced mobile applications and a leading eReading infrastructure.
The investment will enhance innovative capacity of 3M providing it with business opportunities that will create high growth potential for a number of 3M divisions. txtr’s eReading cloud services will boost 3M’s commercialization of innovative solutions for its customers.
Strong cash flow position and continuously expanding sales revenue provides 3M ample resources to expand through acquisition and innovation of new products. 3M is globally recognized for its innovations, together with some of its well-known brands such as Nexcare, Post-it, Scotch, Scotch-Brite, and Scotchgard being the market leaders. We believe that continued capital expenditure with new product launches should bolster its prospects across most end markets.
However, the company’s growth objectives are largely dependent on timing and market acceptances of its new product offerings, including its ability to continually renew its pipeline of new offerings and bring those to the market at acceptable price points. Further, the results have been impacted by worldwide economic and capital market conditions.
Negative consumer sentiment is affecting the retail store traffic. On the corporate side, lower employment levels are negatively reducing office supply purchases in most companies.
3M Company together with its subsidiaries, operates as a diversified technology company with manufacturing operations spread over 60 countries worldwide. It has more than 35 business units organized into six segments: Consumer and Office, Display and Graphics, Electro and Communications, Healthcare, Industrial and Transportation, Safety, Security and Protection Services Business. Major competitors of 3M are Avery Dennison Corporation (AVY), EI DuPont de Nemours & Co. (DD) and Johnson & Johnson (JNJ).
We continue to maintain a Neutral rating on 3M Company for the long term. The company has a Zacks #3 Rank (Hold recommendation) over the next one-to-three months.
AVERY DENNISON (AVY): Free Stock Analysis Report
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