On Jan. 29, Motley Fool Inside Value recommendation 3M (NYSE: MMM) released earnings for the fiscal year ended Dec. 31, 2007.

  • Finally, here's a major U.S. business that managed to outpace international sales growth with its domestic take (though much of the U.S. boost came via acquisitions). The company grew sales from continuing operations by 6.1% abroad -- in local currency -- and 6.7% at home.
  • Return on invested capital shrank to 21.4% for 2007 from 22.5% in 2006. That's still a good ratio for 3M, historically speaking, and way better than the below-20% numbers that were routine five years ago.
  • Our Motley Fool CAPS players love multinational conglomerates, judging by 3M and its immediate neighbors. Pop on over to see why or add your own insights to the debate.

(Figures in millions, except per-share data)

Income Statement Highlights

FY 2007

FY 2006

Change

Sales

$24,462

$22,923

6.7%

Net Profit

$4,096

$3,851

6.4%

EPS

$5.60

$5.06

10.7%

Diluted Shares

732

761

(3.8%)

Get back to basics with the income statement.

Margin Checkup

FY 2007

FY 2006

Change*

Gross Margin

47.9%

48.9%

(1.0)

Operating Margin

25.3%

24.9%

0.5

Net Margin

16.7%

16.8%

(0.1)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

FY 2007

FY 2006

Change

Cash + ST Invest.

$2,475

$1,918

29%

Accounts Rec.

$3,362

$3,102

8.4%

Inventory

$2,852

$2,601

9.7%

Liabilities

FY 2007

FY 2006

Change

Accounts Payable

$1,505

$1,402

7.3%

Long-Term Debt

$4,019

$1,047

283.9%

The balance sheet reflects the company's health.

Cash Flow Highlights

FY 2007

FY 2006

Change

Cash From Ops.

$4,275

$3,839

11.4%

Capital Expenditures

$1,422

$1,168

21.7%

Free Cash Flow

$2,853

$2,671

6.8%

Free cash flow is a Fool's best friend.

Competitive Context

Market Cap (in $billions)

Trailing P/E Ratio

CAPS Rating

General Electric (NYSE: GE)

$351.4

16.1

****

3M

$55.9

14.0

*****

Danaher (NYSE: DHR)

$23.8

17.8

*****

Tyco International (NYSE: TYC)

$19.1

N/A

***

Related Foolishness:

Both Tyco and 3M are recommendations of Inside Value. Try the newsletter service free for 30 days to find the stocks that could bounce back better than ever.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Fool contributor Anders Bylund had no position in any company mentioned. Fool rules are here.