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Berkshire Hathaway’s huge and growing Insurance Operations segment has kept its underwriting profit streak alive for over 14 years. Insurance group’s 2016 revenues, however, were down 0.5% year over year to $55.7 billion. The segment’s net earnings attributable to Berkshire Hathaway dipped 2% year over year to $5 billion in 2016.
Railroad, Utilities and Energy operating revenues decreased 6.25% year over year to $37.5 billion in 2016 due to a decline in revenues from the railroad business. Net earnings of $5.9 billion were down 7.8% year over year, primarily due to a 16% plunge in earnings from the railroad business, partially offset by a 7.3% increase in earnings from the energy business.
Total revenue at Manufacturing, Service and Retailing grew 12% year over year to $120 billion in 2016. Net earnings surged 19% year over year to $5.6 billion in 2016.
Revenues at Berkshire Hathaway's Finance & Financial Products – including Clayton Homes (manufactured housing and finance), CORT Business Services (furniture rental), Marmon (rail car and other transportation equipment manufacturing, repair, and leasing), and XTRA (over-the-road trailer leasing) – jumped 37% year over year to $37.5 billion in 2016. Net earnings attributable to Berkshire Hathaway increased 3.6% year over year to $1.4 million in 2016.
Financial Position
As of Dec 31, 2016, consolidated shareholders’ equity was $283 billion, up 10.7% from Dec 31, 2015. As of Dec 31, 2016, consolidated cash approximated $28 billion, down 58% from the 2015-end level. Cash from operations totaled $32.5 billion in 2016, up 1.6% year over year.
As of Dec 31, 2016, Berkshire Hathaway’s book value increased 10.6% from year-end 2015 to $172.1 per share.
The company exited 2016 with float of $91.6 billion.
Among the other insurers that have reported their fourth-quarter earnings so far, the bottom line at Progressive Corp. (PGR - Free Report) , The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat their respective Zacks Consensus Estimate.
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Berkshire Hathaway (BRK.B) Q4 Earnings Down, Revenues Up Y/Y
Berkshire Hathaway Inc.’s (BRK.B - Free Report) fourth-quarter 2016 operating earnings of $1.78 per share declined 5.3% year over year.
Berkshire Hathaway's earnings decline can be attributed to lower operating earnings from Insurance Operations and Railroad, Utilities and Energy.
Revenues in the reported quarter increased 12.8% year over year to $58.3 million.
2016 Highlights
Operating earnings came in at $7.13 per share, up 1.3% year over year.
Revenues of $223.6 million increased 6% over 2015.
Berkshire Hathaway Inc. Price, Consensus and EPS Surprise
Berkshire Hathaway Inc. Price, Consensus and EPS Surprise | Berkshire Hathaway Inc. Quote
Segment Results
Berkshire Hathaway’s huge and growing Insurance Operations segment has kept its underwriting profit streak alive for over 14 years. Insurance group’s 2016 revenues, however, were down 0.5% year over year to $55.7 billion. The segment’s net earnings attributable to Berkshire Hathaway dipped 2% year over year to $5 billion in 2016.
Railroad, Utilities and Energy operating revenues decreased 6.25% year over year to $37.5 billion in 2016 due to a decline in revenues from the railroad business. Net earnings of $5.9 billion were down 7.8% year over year, primarily due to a 16% plunge in earnings from the railroad business, partially offset by a 7.3% increase in earnings from the energy business.
Total revenue at Manufacturing, Service and Retailing grew 12% year over year to $120 billion in 2016. Net earnings surged 19% year over year to $5.6 billion in 2016.
Revenues at Berkshire Hathaway's Finance & Financial Products – including Clayton Homes (manufactured housing and finance), CORT Business Services (furniture rental), Marmon (rail car and other transportation equipment manufacturing, repair, and leasing), and XTRA (over-the-road trailer leasing) – jumped 37% year over year to $37.5 billion in 2016. Net earnings attributable to Berkshire Hathaway increased 3.6% year over year to $1.4 million in 2016.
Financial Position
As of Dec 31, 2016, consolidated shareholders’ equity was $283 billion, up 10.7% from Dec 31, 2015. As of Dec 31, 2016, consolidated cash approximated $28 billion, down 58% from the 2015-end level. Cash from operations totaled $32.5 billion in 2016, up 1.6% year over year.
As of Dec 31, 2016, Berkshire Hathaway’s book value increased 10.6% from year-end 2015 to $172.1 per share.
The company exited 2016 with float of $91.6 billion.
Zacks Rank
Berkshire Hathaway carries a Zacks Rank # 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other P&C Insurers
Among the other insurers that have reported their fourth-quarter earnings so far, the bottom line at Progressive Corp. (PGR - Free Report) , The Travelers Companies Inc. (TRV - Free Report) and RLI Corp. (RLI - Free Report) beat their respective Zacks Consensus Estimate.
A Full-Blown Technological Breakthrough in the Making
Zacks’ Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>