We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Berkshire Hathaway Inc. (BRK.B) Down 25.5% Since Last Earnings Report: Can It Rebound?
Read MoreHide Full Article
A month has gone by since the last earnings report for Berkshire Hathaway Inc. (BRK.B - Free Report) . Shares have lost about 25.5% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Berkshire Hathaway Inc. due for a breakout? 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 Q4 Earnings Miss on Poor Segmental Results
Berkshire Hathaway delivered fourth-quarter 2019 earnings of $4.4 billion, down 22.7% year over year.
Operating earnings of $24 billion decreased 3.2% year over year.
The company witnessed soft performance at the Railroad, Utilities and Energy segment and higher expenses.
Behind the Headlines
Revenues increased 2.7% year over year to $254.6 billion.
Costs and expenses inched up 2.9% year over year to $225.7 billion.
Segment Results
Berkshire Hathaway’s Insurance and Other segment revenues increased 3.4% year over year to $211.1 billion on the back of higher insurance premiums earned, increase in sales and service revenues, leasing revenues and Interest, dividend and other investment income. This segment’s net earnings were $5.8 billion, down 4.3% year over year
Railroad, Utilities and Energy operating revenues declined 0.5% year over year to $43.4 billion due to lower revenues from freight rail transportation, energy operations and lower service revenues and other income. Net earnings of $8.3 billion were up 6.1% year over year.
Total revenues at Manufacturing, Service and Retailing rose 1.3% year over year to $142.7 billion. Net earnings grew 0.1% year over year to $9.4 billion.
Financial Position
As of Dec 31, 2019, consolidated shareholders’ equity was $424.8 billion, up 21.8% from the level as of Dec 31, 2018. At 2019 end, cash and cash equivalents were $64.2 billion, up 111% from the level at 2018 end.
The company exited 2019 with a float of about $129 billion, up $6 billion from the figure at year-end 2018.
Cash flow from operating activities totaled $38.7 billion in 2019, declining nearly 3.4% from 2018.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
Currently, Berkshire Hathaway Inc. has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, 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 F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Berkshire Hathaway Inc. has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Berkshire Hathaway Inc. (BRK.B) Down 25.5% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Berkshire Hathaway Inc. (BRK.B - Free Report) . Shares have lost about 25.5% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Berkshire Hathaway Inc. due for a breakout? 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 Q4 Earnings Miss on Poor Segmental Results
Berkshire Hathaway delivered fourth-quarter 2019 earnings of $4.4 billion, down 22.7% year over year.
Operating earnings of $24 billion decreased 3.2% year over year.
The company witnessed soft performance at the Railroad, Utilities and Energy segment and higher expenses.
Behind the Headlines
Revenues increased 2.7% year over year to $254.6 billion.
Costs and expenses inched up 2.9% year over year to $225.7 billion.
Segment Results
Berkshire Hathaway’s Insurance and Other segment revenues increased 3.4% year over year to $211.1 billion on the back of higher insurance premiums earned, increase in sales and service revenues, leasing revenues and Interest, dividend and other investment income. This segment’s net earnings were $5.8 billion, down 4.3% year over year
Railroad, Utilities and Energy operating revenues declined 0.5% year over year to $43.4 billion due to lower revenues from freight rail transportation, energy operations and lower service revenues and other income. Net earnings of $8.3 billion were up 6.1% year over year.
Total revenues at Manufacturing, Service and Retailing rose 1.3% year over year to $142.7 billion. Net earnings grew 0.1% year over year to $9.4 billion.
Financial Position
As of Dec 31, 2019, consolidated shareholders’ equity was $424.8 billion, up 21.8% from the level as of Dec 31, 2018. At 2019 end, cash and cash equivalents were $64.2 billion, up 111% from the level at 2018 end.
The company exited 2019 with a float of about $129 billion, up $6 billion from the figure at year-end 2018.
Cash flow from operating activities totaled $38.7 billion in 2019, declining nearly 3.4% from 2018.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
Currently, Berkshire Hathaway Inc. has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, 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 F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Berkshire Hathaway Inc. has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.