U.S. Markets open in 9 hrs

Berkshire Hathaway Inc. (BRK.B) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Berkshire Hathaway Inc. (BRK.B) closed at $207.92, marking a +0.71% move from the previous day. This move outpaced the S&P 500's daily gain of 0.47%. Meanwhile, the Dow lost 0.29%, and the Nasdaq, a tech-heavy index, added 0.85%.

Heading into today, shares of the company had lost 0.77% over the past month, lagging the Finance sector's gain of 1.97% and the S&P 500's gain of 2.08% in that time.

Wall Street will be looking for positivity from BRK.B as it approaches its next earnings report date. The company is expected to report EPS of $2.71, down 2.87% from the prior-year quarter.

BRK.B's full-year Zacks Consensus Estimates are calling for earnings of $10.53 per share and revenue of $275.35 billion. These results would represent year-over-year changes of +4.78% and +11.1%, respectively.

Investors should also note any recent changes to analyst estimates for BRK.B. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. BRK.B currently has a Zacks Rank of #3 (Hold).

Investors should also note BRK.B's current valuation metrics, including its Forward P/E ratio of 19.61. This represents a premium compared to its industry's average Forward P/E of 14.94.

Investors should also note that BRK.B has a PEG ratio of 2.8 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Insurance - Property and Casualty was holding an average PEG ratio of 1.41 at yesterday's closing price.

The Insurance - Property and Casualty industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 77, which puts it in the top 31% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research