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Here's What to Expect From Berkshire (BRK.B) in Q4 Earnings
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Berkshire Hathaway Inc. (BRK.B - Free Report) is expected to report fourth-quarter 2023 earnings soon. BRK.B delivered an earnings surprise in two of the last four quarters and missed in the other two, the average beat being 0.20%.
The Zacks Consensus Estimate for fourth-quarter earnings is pegged at $1.78 per share, indicating a decrease of 41.6% from the year-ago quarter’s reported figure.
Factors to Consider
The insurance business in the to-be-reported quarter is likely to have benefited from lower catastrophe losses, improved pricing, higher average premiums per auto policy increased exposure and favorable reserve development.
Per reports in Reinsurance News, JP Morgan estimates fourth-quarter insured losses in the range of $8-$10 billion, largely attributable to Hurricane Otis. Per a report in Business Insurance, U.S. commercial insurance rates rose 5.6% on average in the fourth quarter.
Insurers, being beneficiaries of an improving rate environment, are likely to witness improved investment results. A larger investment asset base coupled with a higher reinvestment rate is likely to favor investment results.
Continued insurance business growth is expected to have increased float.
The railroad business is likely to have suffered from lower freight volumes and higher non-fuel operating costs. However, lower fuel costs are likely to have limited the downside.
The Utilities and energy business is expected to have benefited from higher earnings from other energy businesses, including tax equity investments and Northern Powergrid businesses, as well as from the natural gas pipeline businesses.
Higher customer demand for products and services in many businesses is likely to have favored manufacturing, service and retailing businesses.
Expenses are expected to have increased on higher insurance losses and loss adjustment expenses, cost of sales and services, cost of leasing, interest expense, freight rail transportation expenses, utilities and energy cost of sales and other expenses.
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 $1.78. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: Berkshire Hathaway currently carries a Zacks Rank of 3.
Recent Releases
Here are some companies from the same space that delivered an earnings surprise in their last reported quarter.
Arch Capital Group (ACGL - Free Report) delivered an earnings surprise of 50% in the fourth quarter of 2023. It sports a Zacks Rank of 1. Arch Capital’s bottom line increased 16.4% year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axis Capital Holdings (AXS - Free Report) delivered an earnings surprise of 25.81% in the fourth quarter of 2023. Axis Capital also sports a Zacks Rank of 1. The bottom line increased 50.8% year over year.
The Progressive Corporation (PGR - Free Report) delivered an earnings surprise of 22.22% in the fourth quarter of 2023. Progressive sports a Zacks Rank of 1. The bottom line increased 97.3% year over year.
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Here's What to Expect From Berkshire (BRK.B) in Q4 Earnings
Berkshire Hathaway Inc. (BRK.B - Free Report) is expected to report fourth-quarter 2023 earnings soon. BRK.B delivered an earnings surprise in two of the last four quarters and missed in the other two, the average beat being 0.20%.
The Zacks Consensus Estimate for fourth-quarter earnings is pegged at $1.78 per share, indicating a decrease of 41.6% from the year-ago quarter’s reported figure.
Factors to Consider
The insurance business in the to-be-reported quarter is likely to have benefited from lower catastrophe losses, improved pricing, higher average premiums per auto policy increased exposure and favorable reserve development.
Per reports in Reinsurance News, JP Morgan estimates fourth-quarter insured losses in the range of $8-$10 billion, largely attributable to Hurricane Otis. Per a report in Business Insurance, U.S. commercial insurance rates rose 5.6% on average in the fourth quarter.
Insurers, being beneficiaries of an improving rate environment, are likely to witness improved investment results. A larger investment asset base coupled with a higher reinvestment rate is likely to favor investment results.
Continued insurance business growth is expected to have increased float.
The railroad business is likely to have suffered from lower freight volumes and higher non-fuel operating costs. However, lower fuel costs are likely to have limited the downside.
The Utilities and energy business is expected to have benefited from higher earnings from other energy businesses, including tax equity investments and Northern Powergrid businesses, as well as from the natural gas pipeline businesses.
Higher customer demand for products and services in many businesses is likely to have favored manufacturing, service and retailing businesses.
Expenses are expected to have increased on higher insurance losses and loss adjustment expenses, cost of sales and services, cost of leasing, interest expense, freight rail transportation expenses, utilities and energy cost of sales and other expenses.
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 $1.78. 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.
Recent Releases
Here are some companies from the same space that delivered an earnings surprise in their last reported quarter.
Arch Capital Group (ACGL - Free Report) delivered an earnings surprise of 50% in the fourth quarter of 2023. It sports a Zacks Rank of 1. Arch Capital’s bottom line increased 16.4% year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axis Capital Holdings (AXS - Free Report) delivered an earnings surprise of 25.81% in the fourth quarter of 2023. Axis Capital also sports a Zacks Rank of 1. The bottom line increased 50.8% year over year.
The Progressive Corporation (PGR - Free Report) delivered an earnings surprise of 22.22% in the fourth quarter of 2023. Progressive sports a Zacks Rank of 1. The bottom line increased 97.3% year over year.