GURUFOCUS.COM » STOCK LIST » USA » NYSE » Berkshire Hathaway Inc (NYSE:BRK.B) » Definitions » Financial Strength
Switch to:

Berkshire Hathaway Financial Strength

: 6 (As of Mar. 2022)
View and export this data going back to 1996. Start your Free Trial

Berkshire Hathaway has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Berkshire Hathaway's Interest Coverage for the quarter that ended in Mar. 2022 was 7.59. Berkshire Hathaway's debt to revenue ratio for the quarter that ended in Mar. 2022 was 0.43. Altman Z-Score does not apply to banks and insurance companies.


Berkshire Hathaway Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Berkshire Hathaway's Interest Expense for the months ended in Mar. 2022 was $-1,034 Mil. Its Operating Income for the months ended in Mar. 2022 was $0 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2022 was $96,337 Mil.

Berkshire Hathaway's Interest Coverage for the quarter that ended in Mar. 2022 is

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Berkshire Hathaway's Debt to Revenue Ratio for the quarter that ended in Mar. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Mar. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(23324 + 96337) / 275328
=0.43

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Altman Z-Score does not apply to banks and insurance companies.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Berkshire Hathaway  (NYSE:BRK.B) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Berkshire Hathaway has the Financial Strength Rank of 6.


Berkshire Hathaway Financial Strength Related Terms

Thank you for viewing the detailed overview of Berkshire Hathaway's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Berkshire Hathaway Business Description

Berkshire Hathaway logo
Address
3555 Farnam Street, Omaha, NE, USA, 68131
Berkshire Hathaway is a holding company with a wide array of subsidiaries engaged in diverse activities. The firm's core business segment is insurance, run primarily through Geico, Berkshire Hathaway Reinsurance Group, and Berkshire Hathaway Primary Group. Berkshire has used the excess cash thrown off from these and its other operations over the years to acquire Burlington Northern Santa Fe (railroad), Berkshire Hathaway Energy (utilities and energy distributors), and the firms that make up its manufacturing, service, and retailing operations (which include five of Berkshire's largest noninsurance pretax earnings generators: Precision Castparts, Lubrizol, Clayton Homes, Marmon, and IMC/ISCAR). The conglomerate is unique in that it is run on a completely decentralized basis.
Executives
Guyman Charlotte director 3324 78TH PL. N.E. MEDINA WA 98004
Buffett Susan A. director 808 CONAGRA DRIVE OMAHA NE 68102
Davis Christopher C director C/O GRAHAM HOLDINGS COMPANY 1300 NORTH 17TH STREET, SUITE 1700 ARLINGTON VA 22209
Buffett Warren E director, 10 percent owner, officer: Chairman and CEO 3555 FARNAM ST STE 1440 OMAHA NE 68131
Chenault Kenneth I director AMERICAN EXPRESS COMPANY 200 VESEY STREET NEW YORK NY 10285
Jain Ajit director, officer: Vice Chairman 100 FIRST STAMFORD PLACE BHRG STAMFORD CT 06902
Abel Gregory director, officer: Vice Chairman C/O BERKSHIRE HATHAWAY INC. 3555 FARNAM STREET OMAHA NE 68131
Witmer Meryl B director 655 THIRD AVENUE 11TH FLOOR NEW YORK NY 10017
Murphy Thomas S director C/O WALT DISNEY CO 500 S BUENA VISTA STREET BURBANK CA 91521-1010
Burke Stephen B director 41 CENTRAL PARK WEST - APT 11A NEW YORK NY 10023
Bill & Melinda Gates Foundation Trust 10 percent owner 2365 CARILLON POINT KIRKLAND WA 98033
Olson Ronald L director EDISON INTERNATIONAL 2244 WALNUT GROVE AVENUE ROSEMEAD CA 91770
Decker Susan L director C/O YAHOO INC 701 FIRST AVE SUNNYVALE CA 94089
Gates William H Iii director 2365 CARILLON POINT KIRKLAND WA 98033
Chace Malcolm G director ONE PROVIDENCE WASHINGTON PLZ 4TH FL PROVIDENCE RI 02903
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)