Back to top

Image: Bigstock

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

Read MoreHide Full Article

In the latest trading session, Berkshire Hathaway Inc. (BRK.B - Free Report) closed at $174.68, marking a +1.3% move from the previous day. This move outpaced the S&P 500's daily gain of 0.47%. Meanwhile, the Dow gained 0.95%, and the Nasdaq, a tech-heavy index, added 2.3%.

Heading into today, shares of the company had lost 24.78% over the past month, outpacing the Finance sector's loss of 35.64% and the S&P 500's loss of 28.7% in that time.

BRK.B will be looking to display strength as it nears its next earnings release. On that day, BRK.B is projected to report earnings of $2.41 per share, which would represent year-over-year growth of 6.64%.

BRK.B's full-year Zacks Consensus Estimates are calling for earnings of $10.69 per share and revenue of $277.48 billion. These results would represent year-over-year changes of +9.3% and +8.98%, respectively.

It is also important to note the recent changes to analyst estimates for BRK.B. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.61% lower. BRK.B is holding a Zacks Rank of #4 (Sell) right now.

Valuation is also important, so investors should note that BRK.B has a Forward P/E ratio of 16.14 right now. This represents a premium compared to its industry's average Forward P/E of 9.74.

We can also see that BRK.B currently has a PEG ratio of 2.31. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Insurance - Property and Casualty stocks are, on average, holding a PEG ratio of 1.06 based on yesterday's closing prices.

The Insurance - Property and Casualty industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 179, which puts it in the bottom 30% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Berkshire Hathaway Inc. (BRK.B) - free report >>

Published in