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Berkshire (BRK.B) Q4 Earnings Up on Strong Segment Results
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Berkshire Hathaway Inc. (BRK.B - Free Report) delivered fourth-quarter 2021 operating earnings of $7.3 billion that increased 45.1% year over year. The increase was driven by higher earnings at Railroad, Utilities and Energy, and other businesses.
Improved performance in Insurance and Other, Railroad, Utilities and Energy as well as Manufacturing, Service and Retailing resulted in the upside.
Operating earnings at Railroad, Utilities and Energy increased 12.3% year over year to about $2.2 billion.
Berkshire Hathaway Inc. Price, Consensus and EPS Surprise
For 2021, operating earnings of $27.4 billion increased 25.2% year over year.
Revenues increased 12.4% year over year to $276 billion, attributable to higher insurance premiums earned, sales and service revenues, leasing revenues, freight rail transportation revenues, energy operating revenues, service revenues and other income.
Costs and expenses increased 5.5% year over year to $243.9 billion, largely due to an increase in costs and expenses in Insurance and Other and Railroad, Utilities and Energy.
Berkshire Hathaway’s Insurance and Other segment revenues increased 11.9% year over year to $227.9 billion in 2021 on the back of higher insurance premiums earned, sales and service revenues and leasing revenues.
Railroad, Utilities and Energy operating revenues increased about 15.2% year over year to $48.1 billion. Pre-tax earnings of Railroad increased 15.7% year over year to $7.9 billion. Pre-tax earnings of Utilities and Energy increased 28.4% year over year to $3.2 billion. Railroad, utilities and energy operating earnings increased 14.9% year over year to $9.5 billion.
Total revenues at Manufacturing, Service and Retailing increased 14.1% year over year to $153 billion. Pre-tax earnings increased 33.6% year over year to $14.5 billion.
Financial Position
As of Dec 31, 2021, consolidated shareholders’ equity was $514.9 billion, up 14.1% from the level as of Dec 31, 2020. At quarter-end, cash and cash equivalents were $88.7 billion, up 83.3% from the level at 2020 end.
The company exited 2021 with a float of about $147 billion, up $9 billion from the figure at year-end 2020.
Cash flow from operating activities totaled $39.4 billion in 2021, down 0.9% from the year-ago period.
Berkshire Hathaway bought back shares worth $27.1 billion in 2021.
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59 per share. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings per share of $1.05 beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.
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Berkshire (BRK.B) Q4 Earnings Up on Strong Segment Results
Berkshire Hathaway Inc. (BRK.B - Free Report) delivered fourth-quarter 2021 operating earnings of $7.3 billion that increased 45.1% year over year. The increase was driven by higher earnings at Railroad, Utilities and Energy, and other businesses.
Improved performance in Insurance and Other, Railroad, Utilities and Energy as well as Manufacturing, Service and Retailing resulted in the upside.
Operating earnings at Railroad, Utilities and Energy increased 12.3% year over year to about $2.2 billion.
Berkshire Hathaway Inc. Price, Consensus and EPS Surprise
Berkshire Hathaway Inc. price-consensus-eps-surprise-chart | Berkshire Hathaway Inc. Quote
Full-Year Highlights
For 2021, operating earnings of $27.4 billion increased 25.2% year over year.
Revenues increased 12.4% year over year to $276 billion, attributable to higher insurance premiums earned, sales and service revenues, leasing revenues, freight rail transportation revenues, energy operating revenues, service revenues and other income.
Costs and expenses increased 5.5% year over year to $243.9 billion, largely due to an increase in costs and expenses in Insurance and Other and Railroad, Utilities and Energy.
Berkshire Hathaway’s Insurance and Other segment revenues increased 11.9% year over year to $227.9 billion in 2021 on the back of higher insurance premiums earned, sales and service revenues and leasing revenues.
Railroad, Utilities and Energy operating revenues increased about 15.2% year over year to $48.1 billion. Pre-tax earnings of Railroad increased 15.7% year over year to $7.9 billion. Pre-tax earnings of Utilities and Energy increased 28.4% year over year to $3.2 billion. Railroad, utilities and energy operating earnings increased 14.9% year over year to $9.5 billion.
Total revenues at Manufacturing, Service and Retailing increased 14.1% year over year to $153 billion. Pre-tax earnings increased 33.6% year over year to $14.5 billion.
Financial Position
As of Dec 31, 2021, consolidated shareholders’ equity was $514.9 billion, up 14.1% from the level as of Dec 31, 2020. At quarter-end, cash and cash equivalents were $88.7 billion, up 83.3% from the level at 2020 end.
The company exited 2021 with a float of about $147 billion, up $9 billion from the figure at year-end 2020.
Cash flow from operating activities totaled $39.4 billion in 2021, down 0.9% from the year-ago period.
Berkshire Hathaway bought back shares worth $27.1 billion in 2021.
Zacks Rank
Berkshire Hathaway currently 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
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59 per share. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings per share of $1.05 beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.