Berkshire Hathaway B (BRK.B) closed at $258.19 in the latest trading session, marking a -0.24% move from the prior day. This change was narrower than the S&P 500’s 0.32% loss on the day. Elsewhere, the Dow lost 0.32%, while the tech-heavy Nasdaq lost 0.11%.
Prior to today’s trading, shares of the company had gained 3.86% over the past month. This has lagged the Finance sector’s gain of 4.28% and the S&P 500’s gain of 4.4% in that time.
Investors will be hoping for strength from BRK.B as it approaches its next earnings release. The company is expected to report EPS of $2.58, up 7.05% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.67 per share and revenue of $279.2 billion. These totals would mark changes of +16.36% and +13.72%, respectively, from last year.
Any recent changes to analyst estimates for BRK.B should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. The Zacks Consensus EPS estimate has moved 1.16% lower within the past month. BRK.B is currently a Zacks Rank #3 (Hold).
In terms of valuation, BRK.B is currently trading at a Forward P/E ratio of 24.27. For comparison, its industry has an average Forward P/E of 14.98, which means BRK.B is trading at a premium to the group.
We can also see that BRK.B currently has a PEG ratio of 3.47. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Insurance – Property and Casualty was holding an average PEG ratio of 2.26 at yesterday’s closing price.
The Insurance – Property and Casualty industry is part of the Finance sector. This group has a Zacks Industry Rank of 104, putting it in the top 41% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow BRK.B in the coming trading sessions, be sure to utilize Zacks.com.
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