NEW YORK (TheStreet) -- Shares of Berkshire Hathaway Inc. (BRK.B) are up 0.43% to $146.14 in midday trading Thursday, after the company said it is acquiring Procter & Gamble Co's (PG) Duracell battery business in exchange for its $4.7 billion stake in the company, Reuters reports.
Warren Buffet's Berkshire owned about 52.8 million shares of P&G as of June 30, or a stake of about 1.9% worth $4.7 billion as of the end of trading session Wednesday, Reuters added.
The world's biggest household products maker P&G has been in the midst of selling about half of its slow growing brands, and said it would add about $1.8 billion in cash into Duracell before the transaction.
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Separately, TheStreet Ratings team rates BERKSHIRE HATHAWAY as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate BERKSHIRE HATHAWAY (BRK.B) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- BRK.B's revenue growth has slightly outpaced the industry average of 10.0%. Since the same quarter one year prior, revenues slightly increased by 10.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, BRK.B's share price has jumped by 26.16%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, BRK.B should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- Net operating cash flow has significantly increased by 57.47% to $12,324.00 million when compared to the same quarter last year. In addition, BERKSHIRE HATHAWAY has also modestly surpassed the industry average cash flow growth rate of 57.47%.
- BERKSHIRE HATHAWAY's earnings per share declined by 8.8% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BERKSHIRE HATHAWAY increased its bottom line by earning $7.89 versus $5.98 in the prior year. This year, the market expects an improvement in earnings ($9962.57 versus $7.89).
- You can view the full analysis from the report here: BRK.B Ratings Report