Berkshire Hathaway Inc.
Berkshire Hathaway Inc. Fundamental Analysis
Berkshire Hathaway Inc. (BRK.NE) shows moderate financial fundamentals with a PE ratio of 14.61, profit margin of 17.23%, and ROE of 9.78%. The company generates $413.2B in annual revenue with weak year-over-year growth of 1.91%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 51.2/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze BRK.NE's fundamental strength across five key dimensions:
Efficiency Score
WeakBRK.NE struggles to generate sufficient returns from assets.
Valuation Score
ExcellentBRK.NE trades at attractive valuation levels.
Growth Score
WeakBRK.NE faces weak or negative growth trends.
Financial Health Score
ExcellentBRK.NE maintains a strong and stable balance sheet.
Profitability Score
ModerateBRK.NE maintains healthy but balanced margins.
Key Financial Metrics
Is BRK.NE Expensive or Cheap?
P/E Ratio
BRK.NE trades at 14.61 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, BRK.NE's PEG of -21.97 indicates potential undervaluation.
Price to Book
The market values Berkshire Hathaway Inc. at 1.36 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 9.69 times EBITDA. This is generally considered low.
How Well Does BRK.NE Make Money?
Net Profit Margin
For every $100 in sales, Berkshire Hathaway Inc. keeps $17.23 as profit after all expenses.
Operating Margin
Core operations generate 15.49 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $9.78 in profit for every $100 of shareholder equity.
ROA
Berkshire Hathaway Inc. generates $5.48 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Berkshire Hathaway Inc. produces operating cash flow of $48.88B, showing steady but balanced cash generation.
Free Cash Flow
Berkshire Hathaway Inc. produces free cash flow of $26.63B, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.64 in free cash annually.
FCF Yield
BRK.NE converts 2.41% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
14.61
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-21.97
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.36
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.68
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.18
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.49
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How BRK.NE Stacks Against Its Sector Peers
| Metric | BRK.NE Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 14.61 | 18.66 | Better (Cheaper) |
| ROE | 9.78% | 806.00% | Weak |
| Net Margin | 17.23% | -451.00% (disorted) | Strong |
| Debt/Equity | 0.18 | 1.00 | Strong (Low Leverage) |
| Current Ratio | 1.49 | 662.02 | Neutral |
| ROA | 5.48% | -24409.00% (disorted) | Weak |
BRK.NE outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Berkshire Hathaway Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
65.79%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
24.23%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
-10.13%
Industry Style: Value, Dividend, Cyclical
Declining