Berkshire Hathaway Cdr Stock Beneish M Score

BRK Stock   34.55  0.29  0.85%   
This module uses fundamental data of Berkshire Hathaway to approximate the value of its Beneish M Score. Berkshire Hathaway M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Berkshire Hathaway CDR. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in board of governors.
  
As of the 25th of December 2024, Net Debt is likely to drop to about 69.4 B. In addition to that, Long Term Debt is likely to drop to about 121.1 B.
At this time, Berkshire Hathaway's M Score is inapplicable. The earnings manipulation may begin if Berkshire Hathaway's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Berkshire Hathaway executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Berkshire Hathaway's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-3.01
Beneish M Score - Inapplicable
Elasticity of Receivables

1.3

Focus
Asset Quality

1.02

Focus
Expense Coverage

1.2

Focus
Gross Margin Strengs

N/A

Focus
Accruals Factor

1.2

Focus
Depreciation Resistance

N/A

Focus
Net Sales Growth

0.78

Focus
Financial Leverage Condition

0.82

Focus

Berkshire Hathaway Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Berkshire Hathaway's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables40 B39.5 B
Fairly Up
Slightly volatile
Total Revenue342.3 B439.3 B
Significantly Down
Slightly volatile
Total Assets985.7 B1.1 T
Significantly Down
Slightly volatile
Total Current Assets210.5 B233.9 B
Moderately Down
Slightly volatile
Property Plant Equipment206.3 B232.2 B
Fairly Down
Slightly volatile
Selling General Administrative26.7 B28.6 B
Significantly Down
Slightly volatile
Total Current Liabilities53.4 B71.9 B
Way Down
Slightly volatile
Net Debt69.4 B90.2 B
Way Down
Very volatile
Long Term Debt121.1 B122.9 B
Fairly Down
Slightly volatile
Total Cash From Operating Activities43.5 B45 B
Sufficiently Down
Slightly volatile
Short Term Investments94.7 B129.6 B
Way Down
Slightly volatile
Long Term Investments455.2 B536.3 B
Fairly Down
Slightly volatile

Berkshire Hathaway CDR Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Berkshire Hathaway's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Berkshire Hathaway in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Berkshire Hathaway's degree of accounting gimmicks and manipulations.

About Berkshire Hathaway Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Reconciled Depreciation

11.83 Billion

At this time, Berkshire Hathaway's Reconciled Depreciation is very stable compared to the past year.

Berkshire Hathaway Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Berkshire Hathaway. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Receivables35.8B33.9B36.6B37.1B39.5B40.0B
Total Revenue327.2B286.3B354.6B234.2B439.3B342.3B
Total Assets817.7B873.7B958.8B948.5B1.1T985.7B
Total Current Assets184.3B194.0B208.1B203.4B233.9B210.5B
Property Plant Equipment180.3B192.6B196.4B201.9B232.2B206.3B
Selling General Administrative23.3B23.3B23.0B25.1B28.6B26.7B
Total Current Liabilities44.4B45.6B45.2B62.5B71.9B53.4B
Net Debt39.2B68.9B26.1B86.9B90.2B69.4B
Long Term Debt98.7B113.5B111.9B120.3B122.9B121.1B
Total Cash From Operating Activities38.7B39.8B39.4B37.2B45.0B43.5B
Investments13.3B(18.3B)42.4B(61.8B)(31.4B)(29.8B)
Short Term Investments63.8B90.3B58.5B92.8B129.6B94.7B
Long Term Investments348.0B409.2B443.1B454.7B536.3B455.2B

About Berkshire Hathaway Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Berkshire Hathaway CDR's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Berkshire Hathaway using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Berkshire Hathaway CDR based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.

Pair Trading with Berkshire Hathaway

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Berkshire Hathaway position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Berkshire Hathaway will appreciate offsetting losses from the drop in the long position's value.

Moving against Berkshire Stock

  0.54ENB-PH Enbridge H CumPairCorr
The ability to find closely correlated positions to Berkshire Hathaway could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Berkshire Hathaway when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Berkshire Hathaway - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Berkshire Hathaway CDR to buy it.
The correlation of Berkshire Hathaway is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Berkshire Hathaway moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Berkshire Hathaway CDR moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Berkshire Hathaway can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Other Information on Investing in Berkshire Stock

Berkshire Hathaway financial ratios help investors to determine whether Berkshire Stock is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Berkshire with respect to the benefits of owning Berkshire Hathaway security.