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What's in the Cards for Berkshire (BRK.B) in Q4 Earnings?
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Berkshire Hathaway Inc. (BRK.B - Free Report) beat on earnings in one of the three reported quarters and missed in two. The Zacks Consensus Estimate for the fourth quarter of 2021 is pegged at $2.79 per share, indicating an increase of 29.8% from the year-ago quarter reported figure.
Let’s see how things have shaped up prior to the announcement of the fourth-quarter results.
Berkshire Hathaway’s net new business, higher renewals and improved pricing may have aided premium revenues.
Per Marsh, global commercial insurance prices in the fourth quarter of 2021 increased 13%. Global property rates increased 8%, casualty pricing rose 5%, and U.S. financial and professional lines pricing increased 34%, driven by U.S. cyber insurance pricing, which surged 130%.
Continued insurance business growth is expected to have increased float.
An increase in freight volumes and lower costs due to improved productivity are likely to have benefited the railroad business.
The Utilities and energy business is expected to have benefited from higher earnings from the natural gas pipelines, including the effects of a business acquisition, and from the real estate brokerage businesses.
Reviving customer demand in many businesses aided the manufacturing, service and retailing businesses.
Strategic acquisitions are likely to have boosted the performance.
Expenses are expected to have risen on higher insurance losses and loss adjustment expenses, health insurance benefits, insurance underwriting expenses, cost of sales and services, interest expense, freight rail transportation expenses, utilities and energy cost of sales and other expenses, other expenses as well as higher interest expense.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Berkshire Hathaway this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case as you can see below.
Earnings ESP: Berkshire Hathaway has an Earnings ESP of 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $2.79. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Some stocks from the finance sector with the right combination of elements to come up with an earnings beat this time around are:
Extra Space Storage (EXR - Free Report) has an Earnings ESP of +0.38% and a Zacks Rank #3. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.86, indicating an increase of 25.7% from the year-ago reported figure.
Extra Space Storage delivered an earnings beat in all the three reported quarters of 2021.
Crescent Capital BDC (CCAP - Free Report) has an Earnings ESP of +1.61% and a Zacks Rank #3. The Zacks Consensus Estimate for the fourth quarter is pegged at 41 cents, indicating a decrease of 12.8% from the year-ago reported figure.
Crescent Capital delivered an earnings beat in one of the three reported quarters of 2021 while missing in two.
Main Street Capital (MAIN - Free Report) has an Earnings ESP of +4.02% and a Zacks Rank #2. The Zacks Consensus Estimate for the fourth quarter is pegged at 66 cents, indicating an increase of 11.9% from the year-ago reported figure.
Main Street Capital delivered an earnings beat in all the three reported quarters of 2021.
Image: Shutterstock
What's in the Cards for Berkshire (BRK.B) in Q4 Earnings?
Berkshire Hathaway Inc. (BRK.B - Free Report) beat on earnings in one of the three reported quarters and missed in two. The Zacks Consensus Estimate for the fourth quarter of 2021 is pegged at $2.79 per share, indicating an increase of 29.8% from the year-ago quarter reported figure.
Let’s see how things have shaped up prior to the announcement of the fourth-quarter results.
Berkshire Hathaway’s net new business, higher renewals and improved pricing may have aided premium revenues.
Per Marsh, global commercial insurance prices in the fourth quarter of 2021 increased 13%. Global property rates increased 8%, casualty pricing rose 5%, and U.S. financial and professional lines pricing increased 34%, driven by U.S. cyber insurance pricing, which surged 130%.
Continued insurance business growth is expected to have increased float.
An increase in freight volumes and lower costs due to improved productivity are likely to have benefited the railroad business.
The Utilities and energy business is expected to have benefited from higher earnings from the natural gas pipelines, including the effects of a business acquisition, and from the real estate brokerage businesses.
Reviving customer demand in many businesses aided the manufacturing, service and retailing businesses.
Strategic acquisitions are likely to have boosted the performance.
Expenses are expected to have risen on higher insurance losses and loss adjustment expenses, health insurance benefits, insurance underwriting expenses, cost of sales and services, interest expense, freight rail transportation expenses, utilities and energy cost of sales and other expenses, other expenses as well as higher interest expense.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Berkshire Hathaway this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case as you can see below.
Earnings ESP: Berkshire Hathaway has an Earnings ESP of 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $2.79. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Berkshire Hathaway Inc. Price and EPS Surprise
Berkshire Hathaway Inc. price-eps-surprise | Berkshire Hathaway Inc. Quote
Zacks Rank: Berkshire Hathaway currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
Some stocks from the finance sector with the right combination of elements to come up with an earnings beat this time around are:
Extra Space Storage (EXR - Free Report) has an Earnings ESP of +0.38% and a Zacks Rank #3. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.86, indicating an increase of 25.7% from the year-ago reported figure.
Extra Space Storage delivered an earnings beat in all the three reported quarters of 2021.
Crescent Capital BDC (CCAP - Free Report) has an Earnings ESP of +1.61% and a Zacks Rank #3. The Zacks Consensus Estimate for the fourth quarter is pegged at 41 cents, indicating a decrease of 12.8% from the year-ago reported figure.
Crescent Capital delivered an earnings beat in one of the three reported quarters of 2021 while missing in two.
Main Street Capital (MAIN - Free Report) has an Earnings ESP of +4.02% and a Zacks Rank #2. The Zacks Consensus Estimate for the fourth quarter is pegged at 66 cents, indicating an increase of 11.9% from the year-ago reported figure.
Main Street Capital delivered an earnings beat in all the three reported quarters of 2021.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.