Shares of 3M (NYSE: MMM) are up more than 5% in early morning trading after the company posted a double beat in its third quarter earnings report. The St. Paul, Minnesota-based company delivered revenue of $8.31 billion, which was above analysts' expectations for $7.99 billion. On the bottom line, 3M delivered earnings per share of $2.68, above estimates for $2.34.  

Adding fuel to the share price growth, the company increased its earnings guidance for the rest of the year. The company now expects EPS to fall between $8.95 and $9.15. The range has narrowed and increased by five cents on the high end.

At face value, the report suggests it makes sense to get involved with MMM stock, which is trading at prices investors haven't seen in 11 years. And with a relative strength indicator (RSI) that was around 27 prior to earnings, it's fair to say that 3M is objectively oversold.  

But there's been bigger issues weighing on 3M and its stock. It's not clear that the earnings report has provided any clarity on those issues.  

The Why is Important 

By 3M's own admission, the earnings beat was due to its pricing power and cost-cutting moves the conglomerate has undertaken (e.g., layoffs). However, the company also acknowledged that there's a limit to how much more they can increase prices in the face of a weakening consumer.  

This has been a situation the company has faced for most of this year. And that's clear in the fact that the revenue number was down about 3% from the same quarter in 2022, which itself was down about 3% from the Q3 2021. In that context, the report shows that 3M may be managing to stem the revenue decline, but more will have to happen to change the company's low-growth trajectory.  

The Impact of the Lawsuits is Being Felt 

As someone who tends to believe that the know is better than the unknown, it's good that shareholders have a dollar figure put on the long-running lawsuits that 3M was fighting. However, in the current quarter, the company's net loss for the quarter included a $4.2 billion charge from the settlement of its Combat Arms earplugs litigation.  

Shareholders can expect more of that in the future, as well as charges stemming from the resolution of its forever chemicals lawsuit. While the company will be able to spread the impact of this litigation over many years, it's something investors should be concerned about. Fortunately, the company had been doing a good job of reducing its long-term debt in advance of the settlements. In the current quarter, 3M reported $10.8 billion in long-term debt, down 11% year-over-year. 

The Dividend Appears to be Safe 

Historically, 3M officially announces its quarterly dividend a couple of weeks after earnings. However, the company is setting aside money for the dividend, and there will be no unpleasant surprises for investors. 

That's key because the most appealing aspect of MMM stock is the company's status as a Dividend King. The company has increased its dividend for 66 consecutive years, and that dividend currently has a yield of 6.67%. 

Analysts Have a Consensus Hold on MMM Stock 

The 3M Analyst Ratings on MarketBeat show the stock with a consensus Hold rating and a price target of $109.55. That would indicate a 21% upside. Investors looking to take a position will want to see what analysts have to say after they have time to digest the company's earnings report. Part of that analysis will include the impact of the company spinning off its healthcare division, which is expected to be complete in the first half of 2024.