Better Buy: Illinois Tool Works or 3M?

It's interesting to compare the performance of multi-industry industrial stocks Illinois Tool Works (NYSE: ITW) and 3M (NYSE: MMM) over the last few years. The two used to be pretty much correlated but the divergence since the spring of 2019 has been remarkable. Both companies have suffered the ill wind of the decline in the industrial economy, but ITW's self-help initiatives have led to it significantly outperform 3M -- a company whose most disappointing performances in recent years have actually come from its least cyclical businesses. Let's take a closer look at Illinois Tool Works and 3M to find out which is the more attractive stock.

Image source: Getty Images.

Illinois Tool Works, 3M, and other industrial companies have been battling some challenging end markets in 2019. It's no secret that the industrial economy is in a tough place right now, with particular weakness in key end markets like automotive, trucking, and oil and gas. On the fourth-quarter earnings call, ITW CEO Ernest Scott Santi described it as "an industrial demand environment that went from decelerating in the first half of the year to contracting in the second half of the year."

Source Fool.com