3M (NYSE:MMM) versus Marubeni (OTCMKTS:MARUY) Critical Survey

3M (NYSE:MMM) and Marubeni (OTCMKTS:MARUY) are both large-cap industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Volatility and Risk

3M has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, Marubeni has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for 3M and Marubeni, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
3M	2	5	8	0	2.40
Marubeni	0	2	0	0	2.00

3M currently has a consensus target price of $177.21, suggesting a potential downside of 2.97%. Given 3M’s stronger consensus rating and higher probable upside, analysts plainly believe 3M is more favorable than Marubeni.

Profitability

This table compares 3M and Marubeni’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
3M	11.90%	115.87%	12.52%
Marubeni	6.62%	13.16%	5.66%

Valuation and Earnings

This table compares 3M and Marubeni”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
3M	$24.95 billion	3.78	$3.25 billion	$5.63	32.44
Marubeni	$54.91 billion	0.94	$3.59 billion	$2.28	13.60

Marubeni has higher revenue and earnings than 3M. Marubeni is trading at a lower price-to-earnings ratio than 3M, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

65.2% of 3M shares are owned by institutional investors. Comparatively, 0.1% of Marubeni shares are owned by institutional investors. 0.2% of 3M shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

3M pays an annual dividend of $3.12 per share and has a dividend yield of 1.7%. Marubeni pays an annual dividend of $0.56 per share and has a dividend yield of 1.8%. 3M pays out 55.4% of its earnings in the form of a dividend. Marubeni pays out 24.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. 3M has raised its dividend for 1 consecutive years. Marubeni is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

3M beats Marubeni on 13 of the 17 factors compared between the two stocks.

About 3M

3M Company provides diversified technology services in the United States and internationally. The company’s Safety and Industrial segment offers industrial abrasives and finishing for metalworking applications; autobody repair solutions; closure systems for personal hygiene products, masking, and packaging materials; electrical products and materials for construction and maintenance, power distribution, and electrical original equipment manufacturers; structural adhesives and tapes; respiratory, hearing, eye, and fall protection solutions; and natural and color-coated mineral granules for shingles. Its Transportation and Electronics segment provides ceramic solutions; attachment/bonding products, films, sound, and temperature management for transportation vehicles; premium large format graphic films for advertising and fleet signage; light management films and electronics assembly solutions; packaging and interconnection solutions; semiconductor production materials; data centers solutions; and reflective signage for highway, and vehicle safety. The company’s Consumer segment provides consumer bandages, braces, supports, and consumer respirators; home cleaning products; retail abrasives, paint accessories, car care DIY products, picture hanging, and consumer air quality solutions; and stationery products. It offers its products through e-commerce and traditional wholesalers, retailers, jobbers, distributors, and dealers. 3M Company was founded in 1902 and is headquartered in Saint Paul, Minnesota.

About Marubeni

Marubeni Corporation engages in various business activities. It manufactures, wholesales, and retails apparel, footwear, home furnishing and sport goods, industrial and textile materials, tire and rubber materials, and household and nursing care products; develops uranium, nuclear fuel cycle, iron ore, coking coal, copper mines, and related equipment and services; smelts and refines aluminum and magnesium; leases temporary steel construction materials; explores for, develops, and produces oil and gas; manages infrastructure funds; and develops and manages real estate. The company also offers insurance, technical, ICT, and logistic services; agri-inputs; fertilizer and crop protection product contracting services; crop protection product formulations; wood chips, biomass fuels, pulp and waste papers, paper, paperboards, sanitary, and building and construction materials; engineering, procurement, and construction services; and operation and maintenance services. It trades in fertilizers, dairy, agricultural, and marine products; sugar, processed food, beverages raw materials, and commercial use food materials; grains, oilseeds, feed ingredients, compound feeds, fresh and processed meat, petrochemicals, plastics, salts, chlor-alkalis, life science products, electronic materials, fertilizer materials, and inorganic mineral resources and chemicals; steelmaking raw materials, ferroalloys, nonferrous metals, and steel products; cement and ingots related materials; and petroleum and LPG. The company engages in infrastructure; water; automotive finance; power generation; power service and retail; natural gas; hydrogen; and fuel ammonia businesses. It owns, purchases, operates, leases, sells, and charters aerospace and ship products; leases refrigerated trailers, commercial vehicles, and freight cars; and sells, trades in, leases, finances, and services construction and industrial machinery, and mobility products. The company was founded in 1858 and is based in Tokyo, Japan.