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Berkshire Hathaway Inc. (BRK.B), headquartered in Omaha, Nebraska, is a diversified holding company that owns businesses across insurance and reinsurance, freight rail transportation, utilities and energy, manufacturing services, and retailing. Valued at $936.37 billion by market cap, the company is chaired by prominent investor Warren Buffett, widely regarded as one of the world’s most successful investors. The conglomerate is expected to announce its fiscal second-quarter earnings for 2024 on Friday, Aug. 2.
Ahead of the event, analysts expect BRK.B to report a profit of $5.10 per share on a diluted basis, up 10.4% from $4.62 per share in the year-ago quarter. The company beat the consensus estimates in three of the last four quarters while missing on one other occasion.
For fiscal 2024, analysts expect BRK.B to report EPS of $18.78, up 9.3% from $17.18 in fiscal 2023.
BRK.B stock has outperformed the S&P 500’s ($SPX) 16.4% gains on a YTD basis, with shares up 21.7% during this period. Similarly, it outshined the S&P 500 Financials Sector SPDR’s (XLF) 14% gains over the same time frame.
BRB.B’s overall performance can be attributed to its robust Q1 results and the strength of its subsidiary businesses. Its operating earnings rose 39.1% year over year to $11.22 billion. The company’s underwriting income nearly tripled over the prior-year quarter, and its insurance investment income increased 32% year over year to $2.60 billion, benefiting from the high interest rates.
The company trimmed its Apple Inc. (AAPL) position by 13% during the first quarter but remained its largest investment. It has spent $2.6 billion on buybacks of both Class A and Class B shares, given its vast cash stockpile. Meanwhile, the company’s newest investment, Chubb Limited (CB), was revealed during the quarter. The latest regulatory filings showed that BRB.B held 25.92 million shares of the company at the end of Q1. BRB.B’s latest investment in Chubb will strengthen its presence in the insurance sector. Since its Q1 results were reported on May 4, BRB.B’s shares have been on an uptrend since then.
Analysts’ consensus opinion on BRK.B stock is bullish, with a “Moderate Buy” rating overall. Out of four analysts covering the stock, two advise a “Strong Buy” rating, and two recommend a “Hold.” The average analyst price target for BRK.B is $490, indicating a 12.8% potential upside from the current levels.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
