Berkshire Hathaway - Fall To Continue?Given the latest sell off it looks like the most famous investment conglomerate Berkshire Hathaway is less likely to reach its former highs in the near future.
If so, how deep it may fall?
Fundamental indicators:
Revenue and Profits - demonstrated consistent long-term earnings growth over the past 10 years except 2020
Profit margin - not consistent and varies from 10% to 20%, 2021 was with the highest 28%
P/E - 8.4x which is considerably lower than the current S&P500 ratio
Liabilities - no problems with debt
Technical Analysis (Elliott Waves):
Following the sharp drop since March 2022 it is very likely that impulse wave that was developing since March 2020 has completed with an Ending Diagonal as fifth wave
If so, then we are observing the development of a new global correction which may be quite deep, in the range of $160-$240, and lengthy depending on the market sentiment and materialisation of recession risks
Currently we can see formation of Double Zig-Zag, the first one has completed in wave W. Second zig-zag is in progress with fully formed wave A, wave B to follow to the upside into the region of $325-$340
This correction wave X may last until the next earnings report planned for the beginning of August and if it is not going to reach market expectations the shares may drop further
Although fundamentals are quite good at this stage of the market cycle, Berkshire is doing reshuffle of its portfolio which may impact these fundamental indicators. Let's see what the next report is going to tell us.
What do you think about Berkshire Hathaway and its short term prospects?
Also let me know if you would like to see other stocks, indices, Forex or Crypto analysed using Elliott Waves .
Thanks
PS this is an update to the previous idea where the scenario suggested another run to update the highs
BRYN trade ideas
Neutral $BRK.B $319.78Neutral $BRK.B $319.78. BRK.B repeating the pattern from Nov 2020 and Mar 2021. Price action shows this time stock reached the target in shorter time span. Expect little more addition to stock price and then sideways trade action between $300 till $320 till next breakout pattern appears. Expect 20 SMA acting as support for this stock.
Berkshire ABerkshire Hathaway A -
trend that I am following currently-
same settings as the microsoft- chart I just recently posted-
just trend analyst for a future alpha trend that I am making to impliment to other currencies-
going to add algorithims to most my currencies if they do not have one already- I know bitcoin does- but not
sure about my other currencies- so I will be doing some research in the next few weeks- and making a new alpha trend- for atleast 3-5 of my currencies
I will add this custom made alpha trend to apply to the market- shortly.
Warren Buffett likes 50% RetracementsI was researching the holdings of AMEX:XLF to prepare for Sector Rotation into Financial which I think is due shortly and the top holding in that ETF is NYSE:BRK.B . While analyzing the chart I find that there were two distinct opportunities at major 50% Retracement Levels on 1/24/2022 and 2/24/2022. These are quite excellent holds of my key principle levels and a testament to the versatility of this one simple analysis.
BRK.B: for value, dividend & diversified investiors; good hedgeBerkshire Hathaway of Warren Buffet is well known for value-investing. In an environment where growth stocks already had a great run & now correcting, may BRK.B is a sound hedge for the moment. This ETF had financials like BAC, V, MA & the latest is a Brazilian Bank NU which are good hedges for rising interest rates. It had several utilities, consumer staples, retails & health stocks as defensive stocks. (Abbe, PG, KR, KO, MCD, transport stocks). Put AAPL, MSFT, SNOW & the latest ACTivision stock for a mix of technology.
Maybe it is because of this balanced portfolio that BRK.B was not much affected by recent crash.
However, the recent spike in ACTivision & NU stock pushed BRK.B to overshoot its MEGAPHONE pattern.
It the short term, it may come back down to retest the upper Megaphone or the uptrend line before resuming rally.
Normally a rising wedge usually breaks downward but this is less likely as there is a very strong horizontal support zone below.
Not trading advice
Fundamental and statistical analysis method - ExplainedHi All,
I have been asked by few in comments and personally to post fundamental analysis of few other companies in similar way as that of FB and PYPL (as per linked ideas). Since, I will not be able to take all the requests, I thought I will make a video explaining how to do it yourself :)
⬜ Following things are discussed in the video
🎲 Earnings
Not significant unless the gap is too much. Things to look for are:
If the recent earnings and revenue has met expectation/estimation
If the next earning/revenue estimates are higher/lower than current one.
Cyclical nature of quarterly earnings - check results and estimations of last two years of same quarter
🎲 Quality
Can use open source script Quality-Screen from community library.
Color coded based on standards and very generic method.
May also need to consider that some of these stats may be industry and sector based and may require comparison among similar stocks.
Overall - if green/lime good, if lots of red/orange - bad. Silver - in between.
🎲 Relative Growth
Can use open source script Relative-Growth-Screen from community library.
Applies Bollinger bands/ Keltener channel to define whether they are relatively high or low. Can also use RSI - but, have not tried :)
Measures growth over past few years.
🎲 Drawdown from ATH
Price drawdown from ATH and historical drawdown levels. Can use open source script Drawdown-Range from community library.
Tells what is the current price drawdown from ATH.
Provides details on historical drawdown levels and ranges.
🎲 Drawdown comparison - price vs fundamentals
Percentile-Price-vs-Fundamentals is the utility I built to carry out the comparison. I am not sure if there are any other comparable tools. Tool is useful for comparing if price drawdown is justified with the drop of fundamentals or if this is an overreaction.
⬜ Please note
▶ News events and probability of future potentials are not taken into consideration. Objective here is to work solely based on the readily available stats.
▶ It is unreliable use this method for short term trading as we cannot be sure when the things going to price in or if they have already priced in.
▶ Not a financial advise. Just an idea based on the research I have done so far. Constructive criticism welcome. Happy to learn from others.