- 3M to increase production from 1.1 billion to 2 billion N95 respirators per year.
- Analysts expect a £242 million of sales boost for 3M due to the rising demand of N95 masks.
- 3M is currently trading a little under 25% down in the stock market in 2020 so far.
U.S industrial giant, 3M (NYSE:MMM), has been actively producing face masks amidst the Coronavirus emergency. The Minnesota-based conglomerate that is currently valued at £64 billion is a leading manufacturer for N95 face masks that are the most in need during the ongoing health emergency.
N95 respirators are named for their quality to filter as many as 95% of the small and larger particles including a range of bacteria. The filtering face masks are essential equipment for workers from multiple industries like construction and medicine.
3M Recently Doubled Production From 400 Million Masks To 1.1 Billion Per Year
With Coronavirus spreading quickly in 2020, the global health workforce had expressed concern about an expected shortage of such essential equipment. According to a statement by the United States Department of Health and Human Services at the start of March, the country needed 3.5 billion N95 masks if the pandemic grew to its full potential while the U.S roughly had 35 million masks only at the time.
3M previously had its production capacity capped at 400 million N95 respirators annually. Owing to the sharply rising demand, 3M recently upgraded its capacity to produce 1.1 billion masks per year. In its statement last week, 3M also highlighted its plans of doubling the production again to 2 billion filtering masks in the upcoming 12 months.
Analysts Expect An Additional £242 Million Of Masks Sales Due To The Increased Demand
According to the analysts, the rising demand for N95 face masks can result in a small increase in 3M’s financial performance. The company had recorded £25.88 billion in sales in 2019. While the official figure from the industrial giant isn’t available, experts estimate that the company sold £80.88 million to £262.87 million of masks before the Coronavirus pandemic. They expect another £242 million generated from the sales of face masks due to the health crisis.
All in all, however, the increment still makes up a very small portion of 3M’s overall sales from its businesses.
At the time of writing, 3M is exchanging hands at £111.40 per share in the stock market that translates to a little under 25% decline in 2020 so far. 3M had also struggled in 2019 with an annual decline of around 8%. Compared to its record-high in January 2018, the stock is currently trading around 50% down. 3M has a price to earnings ratio of 17.63.