Berkshire Hathaway Inc., together with 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.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS. Shaded region = analyst consensus for the current and next fiscal year (3 analysts).
| Parameter | BaseValue |
|---|---|
Initial Cash Flow | |
| Growth Rate (Yr 1-5) | % |
| Growth Rate (Yr 6-10) | % |
| Terminal Growth Rate | % |
| Discount Rate | % |
Base Case $643.73 Implied EV: $1.12T |
What growth rate is the market pricing in at $489?
The market implies +0.4% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +1.6%, reflecting heavy growth investment.
Narrow moat with reinvestment efficiency as the key competitive advantage. Improving revenue predictability would strengthen the moat.
"Market is optimistic — be cautious and ensure you have a margin of safety"
Appears undervalued but market is greedy — verify your assumptions aren't too conservative
