On Mar 4, Zacks Investment Research upgraded
Berkshire Hathaway Inc.
) to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
Berkshire Hathaway has been witnessing rising earnings estimates
on the back of a strong fourth-quarter 2013. Moreover, this
conglomerate with over 80 businesses, delivered positive earnings
surprises in 3 of the last 4 quarters with an average beat of
20.4%. The long-term expected earnings growth rate for this stock
Berkshire Hathaway reported fourth-quarter and full year 2013
results on Mar 1. Operating earnings of $1.53 per share
handily beat the Zacks Consensus Estimate of $1.40.
Earnings also compared favorably with $1.14 per share reported in
the year-ago quarter. The earnings outperformance resulted from
solid results in Berkshire's insurance, energy as well as
manufacturing, retail and service businesses.
Total revenue for full-year 2013 surged 12% year over year to
$182.2 billion in 2013 led by higher revenues across all business
segments - Insurance, Railroad, Utilities and Energy as well as
Financial and Financial products.
Berkshire's property and casualty insurance business acts as the
primary impetus driving growth at the company. Berkshire's
economically sensitive non-insurance businesses - utilities and
energy, and manufacturing, service and retail have also shown
exceptional performance and is expected to make increased
contribution in 2014, with improving economy. Berkshire's
Finance and Financial Products segment is also performing well
now after suffering from the soft housing market trends in the
Following the earnings release, the Zacks Consensus Estimate for
2014 increased 1.0% to $6.28 per share as 1 of the 2 estimates
were revised higher over the last 7 days. For 2015, one of the
analysts covering the stock revised its estimates higher over the
same time frame, lifting the Zacks Consensus Estimate by 2.9% to
$7.15 per share.
Other Stocks to Consider
Other property and casualty insurers which look attractive at
current levels, include
American Financial Group Inc.
Am Trust Financial Servcies, Inc.
). All these sport the same Zacks Rank as Berkshire.
AMER FINL GROUP (AFG): Free Stock Analysis
AMTRUST FIN SVC (AFSI): Free Stock Analysis
BERKSHIRE HTH-B (BRK.B): Free Stock Analysis
ALLEGHANY CORP (Y): Free Stock Analysis
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