BERKSHIRE HATHAWAY INC-CL B (BRK.B) Stock Fundamental Analysis
NYSE:BRK.B - New York Stock Exchange, Inc. - US0846707026 - Common Stock - Currency: USD
Taking everything into account, BRK.B scores 4 out of 10 in our fundamental rating. BRK.B was compared to 101 industry peers in the Financial Services industry. Both the profitability and the financial health of BRK.B get a neutral evaluation. Nothing too spectacular is happening here. BRK.B is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year BRK.B was profitable.
BRK.B had a positive operating cash flow in the past year.
Of the past 5 years BRK.B 4 years were profitable.
In the past 5 years BRK.B always reported a positive cash flow from operatings.
1.2 Ratios
BRK.B has a Return On Assets of 7.71%. This is amongst the best in the industry. BRK.B outperforms 86.14% of its industry peers.
The Return On Equity of BRK.B (13.70%) is better than 64.36% of its industry peers.
BRK.B has a Return On Invested Capital of 4.68%. This is in the better half of the industry: BRK.B outperforms 66.34% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BRK.B is below the industry average of 7.70%.
The last Return On Invested Capital (4.68%) for BRK.B is above the 3 year average (4.13%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 13.7% | ||
| ROIC | 4.68% |
ROA(3y)4.77%
ROA(5y)5.71%
ROE(3y)8.68%
ROE(5y)10.68%
ROIC(3y)4.13%
ROIC(5y)3.72%
1.3 Margins
BRK.B has a better Profit Margin (23.96%) than 77.23% of its industry peers.
In the last couple of years the Profit Margin of BRK.B has declined.
The Operating Margin of BRK.B (16.41%) is comparable to the rest of the industry.
BRK.B's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 16.21%, BRK.B is not doing good in the industry: 60.40% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of BRK.B has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.41% | ||
| PM (TTM) | 23.96% | ||
| GM | 16.21% |
OM growth 3Y7.37%
OM growth 5Y4.91%
PM growth 3Y-9.72%
PM growth 5Y-5.61%
GM growth 3Y3.45%
GM growth 5Y2.09%
2. Health
2.1 Basic Checks
BRK.B has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, BRK.B has less shares outstanding
BRK.B has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, BRK.B has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.69 indicates that BRK.B is not a great score, but indicates only limited risk for bankruptcy at the moment.
With an excellent Altman-Z score value of 2.69, BRK.B belongs to the best of the industry, outperforming 83.17% of the companies in the same industry.
BRK.B has a debt to FCF ratio of 10.74. This is a negative value and a sign of low solvency as BRK.B would need 10.74 years to pay back of all of its debts.
The Debt to FCF ratio of BRK.B (10.74) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.19 indicates that BRK.B is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.19, BRK.B is doing good in the industry, outperforming 69.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 10.74 | ||
| Altman-Z | 2.69 |
ROIC/WACC0.56
WACC8.39%
2.3 Liquidity
A Current Ratio of 1.18 indicates that BRK.B should not have too much problems paying its short term obligations.
BRK.B has a Current ratio of 1.18. This is in the better half of the industry: BRK.B outperforms 60.40% of its industry peers.
A Quick Ratio of 0.94 indicates that BRK.B may have some problems paying its short term obligations.
BRK.B has a Quick ratio (0.94) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.18 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
BRK.B shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 27.98%, which is quite impressive.
The Earnings Per Share has been growing by 17.78% on average over the past years. This is quite good.
BRK.B shows a small growth in Revenue. In the last year, the Revenue has grown by 1.91%.
BRK.B shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.84% yearly.
EPS 1Y (TTM)27.98%
EPS 3Y21.97%
EPS 5Y17.78%
EPS Q2Q%71.86%
Revenue 1Y (TTM)1.91%
Revenue growth 3Y10.38%
Revenue growth 5Y7.84%
Sales Q2Q%1.65%
3.2 Future
The Earnings Per Share is expected to grow by 2.27% on average over the next years.
BRK.B is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.94% yearly.
EPS Next Y-2.98%
EPS Next 2Y0.55%
EPS Next 3Y1.32%
EPS Next 5Y2.27%
Revenue Next Year0.01%
Revenue Next 2Y2.23%
Revenue Next 3Y0.14%
Revenue Next 5Y6.94%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
BRK.B is valuated rather expensively with a Price/Earnings ratio of 23.56.
Based on the Price/Earnings ratio, BRK.B is valued a bit more expensive than the industry average as 63.37% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of BRK.B to the average of the S&P500 Index (28.29), we can say BRK.B is valued inline with the index average.
The Price/Forward Earnings ratio is 24.28, which indicates a rather expensive current valuation of BRK.B.
Based on the Price/Forward Earnings ratio, BRK.B is valued a bit more expensive than the industry average as 66.34% of the companies are valued more cheaply.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.08, BRK.B is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.56 | ||
| Fwd PE | 24.28 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as BRK.B.
BRK.B's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 96.36 | ||
| EV/EBITDA | 16.18 |
4.3 Compensation for Growth
The decent profitability rating of BRK.B may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.32
EPS Next 2Y0.55%
EPS Next 3Y1.32%
5. Dividend
5.1 Amount
BRK.B does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
518.21
+1.76 (+0.34%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners33.43%
Inst Owner Change0.02%
Ins Owners37.69%
Ins Owner ChangeN/A
Market Cap1119.33B
Analysts80
Price Target529.35 (2.15%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)16.2%
Min EPS beat(2)-10.41%
Max EPS beat(2)42.8%
EPS beat(4)3
Avg EPS beat(4)16.14%
Min EPS beat(4)-10.41%
Max EPS beat(4)42.8%
EPS beat(8)6
Avg EPS beat(8)12.04%
EPS beat(12)9
Avg EPS beat(12)10.27%
EPS beat(16)12
Avg EPS beat(16)9.92%
Revenue beat(2)0
Avg Revenue beat(2)-3.85%
Min Revenue beat(2)-7.69%
Max Revenue beat(2)-0.01%
Revenue beat(4)1
Avg Revenue beat(4)-1.91%
Min Revenue beat(4)-7.69%
Max Revenue beat(4)0.24%
Revenue beat(8)4
Avg Revenue beat(8)0.64%
Revenue beat(12)5
Avg Revenue beat(12)-0.45%
Revenue beat(16)6
Avg Revenue beat(16)-0.71%
PT rev (1m)-0.16%
PT rev (3m)2.52%
EPS NQ rev (1m)-2.98%
EPS NQ rev (3m)-6.01%
EPS NY rev (1m)3.96%
EPS NY rev (3m)3.68%
Revenue NQ rev (1m)-0.4%
Revenue NQ rev (3m)-1.03%
Revenue NY rev (1m)-0.59%
Revenue NY rev (3m)-1.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.56 | ||
| Fwd PE | 24.28 | ||
| P/S | 3.01 | ||
| P/FCF | 96.36 | ||
| P/OCF | 36.59 | ||
| P/B | 1.72 | ||
| P/tB | 2.11 | ||
| EV/EBITDA | 16.18 |
EPS(TTM)22
EY4.25%
EPS(NY)21.34
Fwd EY4.12%
FCF(TTM)5.38
FCFY1.04%
OCF(TTM)14.16
OCFY2.73%
SpS171.96
BVpS300.63
TBVpS245.24
PEG (NY)N/A
PEG (5Y)1.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 13.7% | ||
| ROCE | 5.79% | ||
| ROIC | 4.68% | ||
| ROICexc | 4.9% | ||
| ROICexgc | 5.89% | ||
| OM | 16.41% | ||
| PM (TTM) | 23.96% | ||
| GM | 16.21% | ||
| FCFM | 3.13% |
ROA(3y)4.77%
ROA(5y)5.71%
ROE(3y)8.68%
ROE(5y)10.68%
ROIC(3y)4.13%
ROIC(5y)3.72%
ROICexc(3y)4.31%
ROICexc(5y)3.94%
ROICexgc(3y)5.19%
ROICexgc(5y)4.78%
ROCE(3y)5.11%
ROCE(5y)4.61%
ROICexcg growth 3Y9.15%
ROICexcg growth 5Y4.04%
ROICexc growth 3Y9.9%
ROICexc growth 5Y4.98%
OM growth 3Y7.37%
OM growth 5Y4.91%
PM growth 3Y-9.72%
PM growth 5Y-5.61%
GM growth 3Y3.45%
GM growth 5Y2.09%
F-Score4
Asset Turnover0.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 10.74 | ||
| Debt/EBITDA | 1.69 | ||
| Cap/Depr | 147.62% | ||
| Cap/Sales | 5.11% | ||
| Interest Coverage | 12.34 | ||
| Cash Conversion | 41.46% | ||
| Profit Quality | 13.05% | ||
| Current Ratio | 1.18 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | 2.69 |
F-Score4
WACC8.39%
ROIC/WACC0.56
Cap/Depr(3y)148.32%
Cap/Depr(5y)138.32%
Cap/Sales(3y)5.18%
Cap/Sales(5y)5.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)27.98%
EPS 3Y21.97%
EPS 5Y17.78%
EPS Q2Q%71.86%
EPS Next Y-2.98%
EPS Next 2Y0.55%
EPS Next 3Y1.32%
EPS Next 5Y2.27%
Revenue 1Y (TTM)1.91%
Revenue growth 3Y10.38%
Revenue growth 5Y7.84%
Sales Q2Q%1.65%
Revenue Next Year0.01%
Revenue Next 2Y2.23%
Revenue Next 3Y0.14%
Revenue Next 5Y6.94%
EBIT growth 1Y26.05%
EBIT growth 3Y18.52%
EBIT growth 5Y13.14%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-61%
FCF growth 3Y-23.7%
FCF growth 5Y-12.55%
OCF growth 1Y-37.82%
OCF growth 3Y-8.11%
OCF growth 5Y-4.59%