Why Analysts Revised Price Targets for Berkshire Hathaway
Target price revised
Wall Street analysts have revised their price target for Berkshire Hathaway (BRK.B) to $300,900 over the next 12 months (or NTM), an implied upside of 8.9% from the current levels. The growth is expected to be driven by the stable performance of the insurance sector, growth in the manufacturing and BNSF divisions, partially offset by the subdued performance of services and stable energy prices. Four analysts have given the company “buy” ratings, whereas four have recommended a “hold.” The company’s ratings could also be affected by how quickly Berkshire can deploy its excess cash reserves.
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Other asset managers (IYF) are also expected to see subdued upside as equity markets are trading at record high valuations amid rising interest rates.
Berkshire’s other major competitors are also seeing marginal upside on a NTM basis. American International Group (AIG) received ten “buys” or “strong buys” out of 19 ratings. The company’s ratings fell marginally with “hold” ratings rising by one to seven. The “sell” or “underperform” ratings stand at two.
Half of the analysts covering General Electric (GE) recommend a “buy” or “strong buy,” six recommend a “hold,” and two recommend an “underperform.”
For Chubb (CB), 16 of the 19 analysts covering the stock rated it a “buy” or “strong buy” in November 2017, while one analyst has given it a “hold” rating. Two analysts have given it an “underperform” or “sell” rating.