NYSE:BRK.B appears to be flying under the radar despite its strong fundamentals.

Last update: Oct 9, 2023

Consider BERKSHIRE HATHAWAY INC-CL B (NYSE:BRK.B) as a top value stock, identified by our stock screening tool. NYSE:BRK.B shines in terms of profitability, solvency, and liquidity, all while remaining very reasonably priced. Let's dive deeper into the analysis.

Looking at the Valuation

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NYSE:BRK.B has received a 9 out of 10:

A Price/Earnings ratio of 0.02 indicates a rather cheap valuation of BRK.B.
Compared to the rest of the industry, the Price/Earnings ratio of BRK.B indicates a rather cheap valuation: BRK.B is cheaper than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.46, BRK.B is valued rather cheaply.
BRK.B is valuated cheaply with a Price/Forward Earnings ratio of 0.01.
100.00% of the companies in the same industry are more expensive than BRK.B, based on the Price/Forward Earnings ratio.
BRK.B's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 18.67.
Based on the Enterprise Value to EBITDA ratio, BRK.B is valued cheaper than 84.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, BRK.B is valued a bit cheaper than the industry average as 70.00% of the companies are valued more expensively.
BRK.B's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of BRK.B may justify a higher PE ratio.
BRK.B's earnings are expected to grow with 12.33% in the coming years. This may justify a more expensive valuation.

Profitability Assessment of NYSE:BRK.B

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:BRK.B was assigned a score of 7 for profitability:

Looking at the Return On Assets, with a value of 8.34%, BRK.B belongs to the top of the industry, outperforming 86.00% of the companies in the same industry.
Looking at the Return On Equity, with a value of 16.09%, BRK.B belongs to the top of the industry, outperforming 83.00% of the companies in the same industry.
BRK.B has a better Return On Invested Capital (3.54%) than 75.00% of its industry peers.
The last Return On Invested Capital (3.54%) for BRK.B is above the 3 year average (3.32%), which is a sign of increasing profitability.
BRK.B's Profit Margin of 26.09% is amongst the best of the industry. BRK.B outperforms 84.00% of its industry peers.
BRK.B's Operating Margin has improved in the last couple of years.
In the last couple of years the Gross Margin of BRK.B has grown nicely.

Health Analysis for NYSE:BRK.B

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:BRK.B has received a 5 out of 10:

BRK.B has a Altman-Z score of 1.64. This is in the better half of the industry: BRK.B outperforms 71.00% of its industry peers.
BRK.B has a Debt to FCF ratio of 4.83. This is in the better half of the industry: BRK.B outperforms 67.00% of its industry peers.
A Debt/Equity ratio of 0.23 indicates that BRK.B is not too dependend on debt financing.
BRK.B's Debt to Equity ratio of 0.23 is fine compared to the rest of the industry. BRK.B outperforms 62.00% of its industry peers.
Looking at the Current ratio, with a value of 1.47, BRK.B is in the better half of the industry, outperforming 62.00% of the companies in the same industry.

Growth Examination for NYSE:BRK.B

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NYSE:BRK.B scores a 6 out of 10:

The Earnings Per Share has grown by an nice 10.09% over the past year.
BRK.B shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.98% yearly.
The Revenue has grown by 15.03% in the past year. This is quite good.
Based on estimates for the next years, BRK.B will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.33% on average per year.
Based on estimates for the next years, BRK.B will show a quite strong growth in Revenue. The Revenue will grow by 13.58% on average per year.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

More Decent Value stocks can be found in our Decent Value screener.

Check the latest full fundamental report of BRK.B for a complete fundamental analysis.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.