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Why Is Berkshire Hathaway B (BRK.B) Up 11.1% Since Last Earnings Report?
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It has been about a month since the last earnings report for Berkshire Hathaway B (BRK.B - Free Report) . Shares have added about 11.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Berkshire Hathaway B due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Berkshire Hathaway delivered second-quarter 2024 operating earnings of $11.6 billion, which increased 15.5% year over year. The increase was driven by higher earnings insurance underwriting and insurance-investment income.
Behind the Headlines
Revenues increased 1.2% year over year to $93.6 billion, attributable to higher revenues at Insurance and Other.
Costs and expenses decreased 1.2% year over year to $79.6 billion, largely due to a decrease in freight rail transportation expenses, utility and energy cost of sales and other expenses, interest expense, and cost of sales and services. The figure was lower than our estimate of $86 billion.
Segment Performance
Berkshire Hathaway’s Insurance and Other segment revenues increased 4.2% year over year to $68.4 billion in the reported quarter on the back of higher insurance premiums earned, leasing revenues and interest, dividend and other investment income.
Insurance underwriting earnings increased 81.5% year over year to $2.3 billion.
Railroad, Utilities and Energy operating revenues decreased 6% year over year to $25.2 billion, primarily due to lower freight rail transportation revenues, utility and energy operating revenues, service revenues and other income. The figure was lower than our estimate of $28 billion. Pre-tax earnings of Railroad increased 0.5% year over year to $1.6 billion.
Operating earnings from the Railroad business increased 0.3% year over year to $1.8 billion.
Total revenues at Manufacturing, Service and Retailing increased 0.2% year over year to $42.2 billion. Pre-tax earnings decreased 5.6% year over year to $4.2 billion.
Earnings from Manufacturing, Service and Retailing businesses decreased 5.3% year over year to $3.2 billion.
Financial Position
As of Jun 30, 2024, consolidated shareholders’ equity was $607.9 billion, up 7.1% from the level as of Dec 31, 2023. At quarter-end, cash and cash equivalents were $36.9 billion, up 9.5% from the level at 2023-end.
BRK.B exited the second quarter of 2024 with a float of about $169 billion, which remained unchanged from the figure at the end of 2023.
Cash flow from operating activities totaled $24.2 billion in the reported quarter, up 14.5% from the year-ago period.
Berkshire Hathaway bought back shares worth $2.9 billion in the first half of 2024.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
The consensus estimate has shifted 5.43% due to these changes.
VGM Scores
At this time, Berkshire Hathaway B has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Berkshire Hathaway B has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Berkshire Hathaway B is part of the Zacks Insurance - Property and Casualty industry. Over the past month, First American Financial (FAF - Free Report) , a stock from the same industry, has gained 5.1%. The company reported its results for the quarter ended June 2024 more than a month ago.
First American Financial reported revenues of $1.61 billion in the last reported quarter, representing a year-over-year change of -2.1%. EPS of $1.27 for the same period compares with $1.35 a year ago.
For the current quarter, First American Financial is expected to post earnings of $1.16 per share, indicating a change of -4.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.9% over the last 30 days.
First American Financial has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.
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Why Is Berkshire Hathaway B (BRK.B) Up 11.1% Since Last Earnings Report?
It has been about a month since the last earnings report for Berkshire Hathaway B (BRK.B - Free Report) . Shares have added about 11.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Berkshire Hathaway B due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Berkshire Hathaway Q2 Earnings & Revenues Rise Y/Y
Berkshire Hathaway delivered second-quarter 2024 operating earnings of $11.6 billion, which increased 15.5% year over year. The increase was driven by higher earnings insurance underwriting and insurance-investment income.
Behind the Headlines
Revenues increased 1.2% year over year to $93.6 billion, attributable to higher revenues at Insurance and Other.
Costs and expenses decreased 1.2% year over year to $79.6 billion, largely due to a decrease in freight rail transportation expenses, utility and energy cost of sales and other expenses, interest expense, and cost of sales and services. The figure was lower than our estimate of $86 billion.
Segment Performance
Berkshire Hathaway’s Insurance and Other segment revenues increased 4.2% year over year to $68.4 billion in the reported quarter on the back of higher insurance premiums earned, leasing revenues and interest, dividend and other investment income.
Insurance underwriting earnings increased 81.5% year over year to $2.3 billion.
Railroad, Utilities and Energy operating revenues decreased 6% year over year to $25.2 billion, primarily due to lower freight rail transportation revenues, utility and energy operating revenues, service revenues and other income. The figure was lower than our estimate of $28 billion. Pre-tax earnings of Railroad increased 0.5% year over year to $1.6 billion.
Operating earnings from the Railroad business increased 0.3% year over year to $1.8 billion.
Total revenues at Manufacturing, Service and Retailing increased 0.2% year over year to $42.2 billion. Pre-tax earnings decreased 5.6% year over year to $4.2 billion.
Earnings from Manufacturing, Service and Retailing businesses decreased 5.3% year over year to $3.2 billion.
Financial Position
As of Jun 30, 2024, consolidated shareholders’ equity was $607.9 billion, up 7.1% from the level as of Dec 31, 2023. At quarter-end, cash and cash equivalents were $36.9 billion, up 9.5% from the level at 2023-end.
BRK.B exited the second quarter of 2024 with a float of about $169 billion, which remained unchanged from the figure at the end of 2023.
Cash flow from operating activities totaled $24.2 billion in the reported quarter, up 14.5% from the year-ago period.
Berkshire Hathaway bought back shares worth $2.9 billion in the first half of 2024.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
The consensus estimate has shifted 5.43% due to these changes.
VGM Scores
At this time, Berkshire Hathaway B has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Berkshire Hathaway B has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Berkshire Hathaway B is part of the Zacks Insurance - Property and Casualty industry. Over the past month, First American Financial (FAF - Free Report) , a stock from the same industry, has gained 5.1%. The company reported its results for the quarter ended June 2024 more than a month ago.
First American Financial reported revenues of $1.61 billion in the last reported quarter, representing a year-over-year change of -2.1%. EPS of $1.27 for the same period compares with $1.35 a year ago.
For the current quarter, First American Financial is expected to post earnings of $1.16 per share, indicating a change of -4.9% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.9% over the last 30 days.
First American Financial has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.