Stock of the Day

September 19, 2019

Berkshire Hathaway (BRK.A)

$717,882.04
-$5,098.09 (-0.7%)
Market Cap: $1.04T

About Berkshire Hathaway

Berkshire Hathaway Inc., through its subsidiaries, engages in the insurance, freight rail transportation, and utility businesses worldwide. It provides property, casualty, life, accident, and health insurance and reinsurance; and operates railroad systems in North America. The company also generates, transmits, stores, and distributes electricity from natural gas, coal, wind, solar, hydro, 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. In addition, the company manufactures boxed chocolates and other confectionery products; specialty chemicals, metal cutting tools, and components for aerospace and power generation applications; and flooring, insulation, roofing and engineered, 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; and recreational vehicles, apparel products, jewelry, and custom picture framing products, and alkaline batteries. Further, it manufactures castings, forgings, fasteners/fastener systems, and aerostructures; and seamless pipes, fittings, downhole casing and tubing, and various mill forms. Additionally, the company distributes televisions and information; franchises and services quick service restaurants; distributes electronic components; and offers logistics services, grocery and foodservice distribution services, and professional aviation training and shared aircraft ownership programs. It also retails automobiles; furniture, bedding, and accessories; household appliances, electronics, and computers; jewelry, watches, crystal, china, stemware, flatware, gifts, and collectibles; kitchenware; and motorcycle apparel and equipment. The company was incorporated in 1998 and is headquartered in Omaha, Nebraska.

Berkshire Hathaway Bull Case

Here are some ways that investors could benefit from investing in Berkshire Hathaway:

  • Berkshire Hathaway has a diverse portfolio across various industries, including insurance, utilities, and manufacturing, which can provide stability and reduce risk for investors.
  • The company has a strong track record of profitability and growth, making it an attractive option for long-term investors seeking capital appreciation.
  • As of now, the stock price of BRK.A is approximately $500,000, reflecting its strong market position and investor confidence.
  • Berkshire Hathaway's subsidiaries, such as its utility operations, are increasingly focusing on renewable energy sources, aligning with global trends towards sustainability and potentially enhancing future profitability.
  • The company's management, led by Warren Buffett, is renowned for its investment acumen and long-term strategic vision, which can instill confidence in investors.

Berkshire Hathaway Bear Case

Investors should be bearish about investing in Berkshire Hathaway for these reasons:

  • The high stock price of BRK.A may deter some investors, as it requires a significant capital outlay to purchase even a single share.
  • With a vast array of subsidiaries, the complexity of managing such a diverse business can lead to inefficiencies and challenges in maintaining consistent performance across all sectors.
  • Market volatility can impact the performance of Berkshire Hathaway's various businesses, particularly in sectors like insurance and utilities, which are sensitive to economic fluctuations.
  • As the company grows, finding new investment opportunities that meet its high standards for return on investment may become increasingly challenging.
  • Regulatory changes in the insurance and utility sectors could pose risks to Berkshire Hathaway's operations and profitability, potentially affecting investor returns.

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