Industrial conglomerate 3M (NYSE:MMM) reduced the Fund’s performance by 41 basis points, as the total return to our average selling price was negative 14.1%. 3M’s stock fell after the company reported weak quarterly earnings and significantly reduced its financial guidance for the full year, due to a slowdown in China and its automotive and electronics businesses. This was the fourth consecutive reduction in annual guidance, and the deepest cut yet, which led us to re-evaluate our investment thesis. We also became concerned that 3M’s environmental liabilities for its historical production of per- and polyfluorinated substances (PFAS) could be significant, so we exited our position.
From Parnassus Fund's second-quarter 2019 commentary.
