Return on Equity (ROE)
since 2005
Calculation
3M Co., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income attributable to 3M1 | ÷ | Total 3M Company shareholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2021 | 39.35% | = | 100 | × | 5,921) | ÷ | 15,046) |
| Dec 31, 2020 | 41.84% | = | 100 | × | 5,384) | ÷ | 12,867) |
| Dec 31, 2019 | 45.41% | = | 100 | × | 4,570) | ÷ | 10,063) |
| Dec 31, 2018 | 54.60% | = | 100 | × | 5,349) | ÷ | 9,796) |
| Dec 31, 2017 | 42.01% | = | 100 | × | 4,858) | ÷ | 11,563) |
| Dec 31, 2016 | 49.04% | = | 100 | × | 5,050) | ÷ | 10,298) |
| Dec 31, 2015 | 41.28% | = | 100 | × | 4,833) | ÷ | 11,708) |
| Dec 31, 2014 | 37.81% | = | 100 | × | 4,956) | ÷ | 13,109) |
| Dec 31, 2013 | 26.62% | = | 100 | × | 4,659) | ÷ | 17,502) |
| Dec 31, 2012 | 25.29% | = | 100 | × | 4,444) | ÷ | 17,575) |
| Dec 31, 2011 | 27.78% | = | 100 | × | 4,283) | ÷ | 15,420) |
| Dec 31, 2010 | 26.08% | = | 100 | × | 4,085) | ÷ | 15,663) |
| Dec 31, 2009 | 25.02% | = | 100 | × | 3,193) | ÷ | 12,764) |
| Dec 31, 2008 | 35.02% | = | 100 | × | 3,460) | ÷ | 9,879) |
| Dec 31, 2007 | 34.87% | = | 100 | × | 4,096) | ÷ | 11,747) |
| Dec 31, 2006 | 38.67% | = | 100 | × | 3,851) | ÷ | 9,959) |
| Dec 31, 2005 | 31.67% | = | 100 | × | 3,199) | ÷ | 10,100) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
The financial performance from 2005 to 2021 demonstrates a significant expansion in return on equity (ROE), characterized by three distinct phases: an initial period of moderate volatility, a period of substantial acceleration, and a subsequent phase of normalization.
- Net Income Trends
- Net income attributable to 3M exhibited a consistent long-term upward trajectory, growing from US$ 3,199 million in 2005 to US$ 5,921 million in 2021. Although a temporary contraction occurred in 2009, coinciding with broader economic instability, earnings recovered quickly and maintained a general growth pattern over the 16-year period.
- Shareholders' Equity Dynamics
- Total shareholders' equity displayed significant volatility. After reaching a peak of US$ 17,575 million in 2012, equity levels declined steadily to a low of US$ 9,796 million in 2018. This reduction in the equity base occurred despite rising net income, suggesting aggressive capital allocation strategies, such as share buybacks or increased dividend distributions.
- Return on Equity (ROE) Analysis
- ROE fluctuated between 25.02% and 38.67% from 2005 to 2013, indicating a period of relative stability. A sharp acceleration began in 2014, with ROE rising from 37.81% to a peak of 54.60% in 2018. This spike was primarily driven by the simultaneous increase in net income and the contraction of the shareholders' equity denominator. From 2019 to 2021, ROE experienced a gradual decline to 39.35%, correlating with a recovery in total shareholders' equity to US$ 15,046 million.
- Correlation of Metrics
- The analysis indicates that the peaks in ROE were more closely tied to changes in the equity base than to fluctuations in net income. The most dramatic increase in efficiency (2014–2018) was achieved through the reduction of equity, which amplified the return on the remaining capital invested.
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Comparison to Competitors
3M Co., ROE, long-term trends, comparison to competitors
| 3M Co. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Dec 31, 2021 | 39.35% | — | 39.37% | 13.06% | -16.17% | 29.85% | 57.62% | 5.29% |
| Dec 31, 2020 | 41.84% | — | 19.56% | 9.44% | 16.04% | 27.23% | 113.60% | -4.88% |
| Dec 31, 2019 | 45.41% | — | 41.77% | 13.75% | -17.58% | 33.22% | 199.23% | 13.25% |
| Dec 31, 2018 | 54.60% | 3,085.55% | 43.79% | 13.32% | -72.16% | 37.21% | 361.98% | 13.70% |
| Dec 31, 2017 | 42.01% | 2,309.01% | 5.50% | 17.30% | -9.00% | 9.58% | — | 15.37% |
| Dec 31, 2016 | 49.04% | 599.14% | -0.51% | 12.90% | 11.65% | 24.83% | 350.89% | 18.33% |
| Dec 31, 2015 | 41.28% | 81.70% | 14.19% | 13.03% | -6.23% | 26.08% | 116.40% | 27.81% |
| Dec 31, 2014 | 37.81% | 62.85% | 22.06% | 11.36% | 11.89% | 24.01% | 106.29% | 19.93% |
| Dec 31, 2013 | 26.62% | 30.82% | 18.21% | 11.08% | 10.00% | 22.47% | 60.61% | 17.95% |
| Dec 31, 2012 | 25.29% | 66.47% | 32.40% | 8.07% | 11.09% | 22.55% | 7,038.46% | 19.80% |
| Dec 31, 2011 | 27.78% | 114.31% | 38.25% | 18.07% | 12.15% | 19.13% | 265.23% | 22.76% |
| Dec 31, 2010 | 26.08% | 119.56% | 24.94% | 12.62% | 9.79% | 18.96% | 78.91% | 20.45% |
| Dec 31, 2009 | 25.02% | 61.65% | 10.24% | 5.65% | 9.40% | 24.34% | 73.24% | 19.08% |
| Dec 31, 2008 | 35.02% | — | 58.44% | 16.75% | 16.63% | 38.85% | 112.29% | 29.46% |
| Dec 31, 2007 | 34.87% | 45.25% | 39.86% | 19.22% | 19.22% | 26.50% | 30.93% | 19.78% |
| Dec 31, 2006 | 38.67% | 46.74% | 51.57% | 23.14% | 18.55% | 21.43% | 36.74% | 21.58% |
| Dec 31, 2005 | 31.67% | 23.26% | 33.85% | 21.31% | 14.95% | 14.71% | 23.20% | 18.06% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Capital Goods)
3M Co., ROE, long-term trends, comparison to sector (capital goods)
| 3M Co. | Capital Goods | |
|---|---|---|
| Dec 31, 2021 | 39.35% | 8.48% |
| Dec 31, 2020 | 41.84% | 4.42% |
| Dec 31, 2019 | 45.41% | 18.11% |
| Dec 31, 2018 | 54.60% | 11.28% |
| Dec 31, 2017 | 42.01% | 10.13% |
| Dec 31, 2016 | 49.04% | 20.08% |
| Dec 31, 2015 | 41.28% | 10.42% |
| Dec 31, 2014 | 37.81% | 18.16% |
| Dec 31, 2013 | 26.62% | 15.14% |
| Dec 31, 2012 | 25.29% | 17.58% |
| Dec 31, 2011 | 27.78% | 19.63% |
| Dec 31, 2010 | 26.08% | 15.88% |
| Dec 31, 2009 | 25.02% | 13.47% |
| Dec 31, 2008 | 35.02% | 24.97% |
| Dec 31, 2007 | 34.87% | 22.64% |
| Dec 31, 2006 | 38.67% | 22.16% |
| Dec 31, 2005 | 31.67% | 17.27% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Industrials)
3M Co., ROE, long-term trends, comparison to industry (industrials)
| 3M Co. | Industrials | |
|---|---|---|
| Dec 31, 2021 | 39.35% | 15.38% |
| Dec 31, 2020 | 41.84% | 0.24% |
| Dec 31, 2019 | 45.41% | 14.56% |
| Dec 31, 2018 | 54.60% | 17.95% |
| Dec 31, 2017 | 42.01% | 18.24% |
| Dec 31, 2016 | 49.04% | 21.69% |
| Dec 31, 2015 | 41.28% | 16.11% |
| Dec 31, 2014 | 37.81% | 19.68% |
| Dec 31, 2013 | 26.62% | 16.40% |
| Dec 31, 2012 | 25.29% | 17.20% |
| Dec 31, 2011 | 27.78% | 20.10% |
| Dec 31, 2010 | 26.08% | 16.41% |
| Dec 31, 2009 | 25.02% | 12.84% |
| Dec 31, 2008 | 35.02% | 20.74% |
| Dec 31, 2007 | 34.87% | 20.36% |
| Dec 31, 2006 | 38.67% | 32.16% |
| Dec 31, 2005 | 31.67% | 7.80% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).