Berkshire Hathaway (BRK.B) has enjoyed a long tenured run of outperformance over the S+P 500 market average. Just in the last four years, Berkshire has seen it’s Class B stock price increase as high as 90%.
However so far this year we have seen a difference story. As the S+P 500 hovered around it’s flatline for the year and currently stands 3% higher, Berkshire Hathaway is down 6-7% year to date.
This price action could be due to the fact that Berkshire’s total revenue growth for 2014 was up 6% as opposed to the 12% and 13% revenue growth of the prior years. Berkshire’s year over year revenue growth for the 1st quarter of 2015 was 7%.
As for the technicals, we can see over the last couple of years that the stock has experienced a few $10-$12 point declines on it’s way up. The lost consolidation/correction took the share price down 9.37% from its intraday high to low. A similar percentage point correction from its 2014 highs at $152.94, would equate to $138.61.
Ironically the share price found support just a touch above that level ($138.78) but has so far failed to get back above it’s 50 and 200 day moving averages.
It’s certainly possible that there is more downside in the near future, if price fails to get back above $144. However if one is bullish on Berkshire’s potential, this may be a good price spot to do just that.
(Disclaimer: long BRK.B)