These days a single stock in Warren Buffet's iconic company costs upwards of US$500,000. In the past, that hefty price tag meant Berkshire Hathaway shares were out of reach to most investors.
That's where Berkshire Hathaway Class B (BRK.B) shares come in. BRK.B shares were launched so that investors could purchase Berkshire shares at a much lower price point. In Australia, you have the option of purchasing both A or B Class shares, depending on the platform you use.
There are two types of Berkshire Hathaway shares available to investors – Class A (BRK.A) and Class B (BRK.B) shares. Regular investors wanting to buy shares in Berkshire Hathaway typically purchase Class B shares thanks to the lower price. B-shares are generally over 1/100th of the price of A-shares.
However, there are other differences that may make Class A shares the more attractive option:
Australian investors can purchase either Class A or Class B shares depending on their preference and the trading platform they use.
While Class A shares may have been out of reach in the past, a number of trading platforms these days offer fractional share trading where fractions of stocks can be purchased. So instead of buying 1 BRK.A stock for US$500,000, you could instead buy a fraction of the stock for say $50.
Either way, Australian investors will need to find a trading platform that offers US stocks if they want to purchase Berkshire Hathaway stocks.
We currently don't have that product, but here are others to consider:
How we picked theseWe've scored over 30 share trading platforms assessing them for their core features, fees, customer experience and accessibility. Our experts give each platform a score out of 10.
Berkshire Hathaway's shares were split on a 50:1 basis on 20 January 2010. So if you had owned 1 share the day before the split, the next day you would own 50 shares. This wouldn't directly have changed the overall worth of your Berkshire Hathaway shares – just the quantity. However, indirectly, the new 98% lower share price could have impacted the market appetite for Berkshire Hathaway shares which in turn could have impacted Berkshire Hathaway's share price.
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The technical analysis gauge below displays real-time ratings for the timeframes you select. However, this is not a recommendation. It represents a technical analysis based on the most popular technical indicators: Moving Averages, Oscillators and Pivots. Finder might not concur and takes no responsibility.
Valuing Berkshire Hathaway stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of Berkshire Hathaway's overall performance. However, analysts commonly use some key metrics to help gauge the value of a stock.
Berkshire Hathaway's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 16x. In other words, Berkshire Hathaway shares trade at around 16x recent earnings.
That's relatively low compared to, say, the trailing 12-month P/E ratio for the NASDAQ 100 at the end of 2019 (27.29). The low P/E ratio could mean that investors are pessimistic about the outlook for the shares or simply that they're under-valued.
Berkshire Hathaway's "price/earnings-to-growth ratio" can be calculated by dividing its P/E ratio by its growth – to give 10.0559. A low ratio can be interpreted as meaning the shares offer better value, while a higher ratio can be interpreted as meaning the shares offer worse value.
The PEG ratio provides a broader view than just the P/E ratio, as it gives more insight into Berkshire Hathaway's future profitability. By accounting for growth, it could also help you if you're comparing the share prices of multiple high-growth companies.
Berkshire Hathaway's EBITDA (earnings before interest, taxes, depreciation and amortisation) is US$103.9 billion (£78.2 billion).
The EBITDA is a measure of a Berkshire Hathaway's overall financial performance and is widely used to measure stock profitability.
Over the last 12 months, Berkshire Hathaway's shares have ranged in value from as little as US$440.1 up to US$542.07. A popular way to gauge a stock's volatility is its "beta".
Beta measures a share's volatility in relation to the market. The market (NYSE average) beta is 1, while Berkshire Hathaway's is 0.709. This would suggest that Berkshire Hathaway's shares are less volatile than average (for this exchange).
| Revenue TTM | US$372.1 billion |
|---|---|
| Operating margin TTM | 41.1% |
| Gross profit TTM | US$90.7 billion |
| Return on assets TTM | 4.78% |
| Return on equity TTM | 10.17% |
| Profit margin | 18.13% |
| Book value | 485274.34 |
| Market capitalisation | US$1.1 trillion |
| EBITDA | US$103.9 billion |
TTM: trailing 12 months
We're not expecting Berkshire Hathaway to pay a dividend over the next 12 months.
Environmental, social and governance (known as ESG) criteria are a set of three factors used to measure the sustainability and social impact of companies like Berkshire Hathaway.
When it comes to ESG scores, lower is better, and lower scores are generally associated with lower risk for would-be investors.
Total ESG risk: 19.08
Socially conscious investors use ESG scores to screen how an investment aligns with their worldview, and Berkshire Hathaway's overall score of 19.08 (as at 12/31/2018) is excellent – landing it in it in the 16th percentile of companies rated in the same sector.
ESG scores are increasingly used to estimate the level of risk a company like Berkshire Hathaway is exposed to within the areas of "environmental" (carbon footprint, resource use etc.), "social" (health and safety, human rights etc.), and "governance" (anti-corruption, tax transparency etc.).
Environmental score: 3.6/100
Berkshire Hathaway's environmental score of 3.6 puts it squarely in the 6th percentile of companies rated in the same sector. This could suggest that Berkshire Hathaway is a leader in its sector terms of its environmental impact, and exposed to a lower level of risk.
Social score: 7.75/100
Berkshire Hathaway's social score of 7.75 puts it squarely in the 6th percentile of companies rated in the same sector. This could suggest that Berkshire Hathaway is a leader in its sector when it comes to taking good care of its workforce and the communities it impacts.
Governance score: 17.22/100
Berkshire Hathaway's governance score puts it squarely in the 6th percentile of companies rated in the same sector. That could suggest that Berkshire Hathaway is a leader in its sector when it comes to responsible management and strategy, and exposed to a lower level of risk.
Controversy score: 1/5
ESG scores also evaluate any incidences of controversy that a company has been involved in. Berkshire Hathaway scored a 1 out of 5 for controversy – the highest score possible, reflecting that Berkshire Hathaway has managed to keep its nose clean.
Berkshire Hathaway Inc was last rated for ESG on: 2019-01-01.
| Total ESG score | 19.08 |
|---|---|
| Total ESG percentile | 15.78 |
| Environmental score | 3.6 |
| Environmental score percentile | 6 |
| Social score | 7.75 |
| Social score percentile | 6 |
| Governance score | 17.22 |
| Governance score percentile | 6 |
| Level of controversy | 1 |
Berkshire Hathaway Inc., through its subsidiaries, engages in the insurance, freight rail transportation, and utility businesses. The company provides property, casualty, life, accident, and health insurance and reinsurance; operates railroad systems in North America; generates, transmits, stores, and distributes electricity from natural gas, coal, wind, solar, hydroelectric, nuclear, and geothermal sources; operates natural gas distribution and storage facilities, interstate pipelines, liquefied natural gas facilities, and compressor and meter stations; and holds interest in coal mining assets. It also manufactures boxed chocolates and other confectionery products; specialty chemicals, metal cutting tools, and components for aerospace and power generation applications; prefabricated and site-built residential homes, flooring products; insulation, roofing, and engineered products; building and engineered components; paints and coatings; and bricks and masonry products, as well as offers manufactured and site-built home construction, and related lending and financial services. In addition, the company provides recreational vehicles, apparel, footwear, toys, jewelry, custom picture framing products, alkaline batteries, logistics services, and professional aviation training and shared aircraft ownership programs; castings, forgings, fasteners/fastener systems, aerostructures, and precision components; and cobalt, nickel, and titanium alloys. Further, it distributes televisions and information, and grocery and non-food consumer products; franchises and services quick service restaurants; and distributes electronic components. Additionally, it retails automobiles; furniture, bedding, and accessories; household appliances, electronics, and floor coverings; watches, crystal, china, stemware, flatware, gifts, and collectibles; sells kitchenware; and motorcycle clothing and equipment. The company was incorporated in 1998 and is headquartered in Omaha, Nebraska.
If you have funds to invest for 2 or years or less, you can safely earn up to 5% p.a. through a high interest savings account, bonds or ETFs.
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