For nearly 18 months, big-cap tech stocks have dominated the market. Most stocks have traded flat or even declined over that time. But in the past few weeks, tech stocks have pulled back, but other stocks have started to show signs of life.
Given how long the big tech outperformance lasted, there’s more room to run higher. Even for stocks that have already had some big jumps over the past few weeks.
That includes industrial conglomerate 3M (MMM). Shares soared over 20% on Friday, following earnings results, which were far better-than-expected. With growth trending higher, shares can continue off this recent strength.
3M shares still trade at a discount to the overall market, at about 17 times forward earnings. 3M is coming off a 12-year period of flat revenue growth, so the push for growth now could mean far more upside for shares.
Action to take: Shares are in an uptrend, and now making new 52-week highs. 3M also pays a 2.7% dividend at current prices. While 3M had to reduce its dividend last year to preserve cash, the push towards higher profits now puts them on a path to raise the payout again.
For traders, there’s likely more upside ahead. The January 2025 $140 calls, last trading for about $5.00, can likely see high double-digit returns from here.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.