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Morning Alert: Berkshire Hathaway Class B decreases 0.2%, leads Insurance sector lower 17 October 2017 11:14 EDT

NEWS BITES - NORTH AMERICA

Berkshire Hathaway Inc. (NYSE:BRK.B) has decreased 0.2% to trade at $US187.50 vs. the Insurance sector which weakened 7.3 points (or 0.3%) to 2,604.3. Representing a weighting of about 24.9% of the sector, the stock accounted for 21.7% of today's loss. Trading volume was 74% of average so far today.

SECTION 1: Technical indicators

Bearish:

The price decreased 0.3% in the last week.

Overbought/Bearish:

The 0.6% discount to 12-month high of $US188.62 against the 31.7% premium to 12-month low of $US142.35 suggests the climb might be peaking.

Fundamental measures by comparison with the sector average [in brackets] indicate:

Parity:

Price to Book of 1.5 [1.5]

Return on Equity 8.5% [7.8%]

Undervaluation:

Return on Assets 3.9% [1.5%]

Overvaluation:

Price/Earnings of 19.2 [13.3]

Note

Bullish:

The positive 2.08 MACD (Moving Average Convergence Divergence) indicator suggests a bullish signal (12-day minus 26-day Exponential Moving Averages). Both the 12-day and the 26-day EMA are rising - another bullish signal. In the past week, the stock's MACD has been positive every day, a reinforcing bullish signal.

In the last three months the stock has hit a new 52-week high seventeen times, pointing to a significant uptrend.

The present value of USD1,000 invested one year ago is $US1,304, for a capital gain of $US304. The total return to shareholders for 1 year is 30.4%.

SECTION 2: Ranking

DescriptionValueRank In Market
MCap $US billion250.1In Top 1%
Today's Volatility %0.5In Top Quartile
52-week Range (in $US)142.3-188.6
1-month Range (in $US)180.3-188.6
RSI74.4Bearish
Stochastic-3.4Bearish

SECTION 3: Earnings

FY2016 Annual Report: Berkshire Hathaway Class B Revenue up 6.0%

Berkshire Hathaway Class B (NYSE:BRK.B) reported total revenue for the year-ended 31 December 2016 of $US224b, up 6% from $US211b in the previous year.

Major changes compared with previous year:

Favourable Changes:

- Total revenue up 6% from $US210.9b to $US223.6b

- Cash to Total Assets up from 12.8% to 13.9%

Unfavourable Changes:

- EBIT Margin down from 16.6% to 15.1%

- EBIT to total assets down from 6.3% to 5.4%

- Profit before tax to Sales down from 16.6% to 15.1%

- Sales and marketing expenses to Sales up from 7.3% to 8.1%

- Debt to Equity up 9.1% from 0.3 to 0.4

- Long-term investments to Total Assets down from 33.1% to 28.7%

- Fixed Assets to Total Assets down from 26.3% to 24.6%

- Other non-current assets to Total Assets down from 6.8% to 6.1%

- Total Liabilities to EBITDA of 9.9 compares unfavourably with the Joseph Piotroski benchmark of less than 5. This ratio has deteriorated by 18.3% from the previous year's ratio of 8.4.

- Total Liabilities to Operating Cash Flow of 10.3 compares unfavourably with the Joseph Piotroski benchmark of less than 4. This ratio has deteriorated by 10.3% from the previous year's ratio of 9.3.

- Net tangible assets per share down 7.5% from $US74.53 to $US68.96

Note:

- EPS steady at $US9.76

- Total revenue to total assets steady at 0.4

- Tax expenses to Sales down from 5% to 4.1%

- Total liabilities to Total assets steady at 0.5

- Retained earnings to total assets steady at 34.1%

- Intangibles to Total Assets up from 13% to 18.2%

Berkshire Hathaway Inc. (N:BRK.B)

ISIN: US0846707026

CIK: 1067983

CUSIP: 84670702

Source: www.BuySellSignals.com