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Berkshire Hathaway B (BRK.B) Gains But Lags Market: What You Should Know

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Zacks Equity Research
·3 min read
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In the latest trading session, Berkshire Hathaway B (BRK.B) closed at $229.32, marking a +0.64% move from the previous day. This change lagged the S&P 500's 1.61% gain on the day. At the same time, the Dow added 0.77%, and the tech-heavy Nasdaq gained 2.55%.

Heading into today, shares of the company had lost 1.73% over the past month, lagging the Finance sector's gain of 0.15% and the S&P 500's loss of 0.35% in that time.

Investors will be hoping for strength from BRK.B as it approaches its next earnings release. In that report, analysts expect BRK.B to post earnings of $2.34 per share. This would mark year-over-year growth of 29.28%.

It is also important to note the recent changes to analyst estimates for BRK.B. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. BRK.B currently has a Zacks Rank of #3 (Hold).

Digging into valuation, BRK.B currently has a Forward P/E ratio of 21.02. This represents a premium compared to its industry's average Forward P/E of 12.77.

Meanwhile, BRK.B's PEG ratio is currently 3. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Insurance - Property and Casualty stocks are, on average, holding a PEG ratio of 1.87 based on yesterday's closing prices.

The Insurance - Property and Casualty industry is part of the Finance sector. This group has a Zacks Industry Rank of 195, putting it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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