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Stifel Downgrades Buffett’s Berkshire To Sell

Stifel Downgrades Buffett’s Berkshire To Sell

In an interview on CNBC’s Fast Money Halftime Report, analyst Meyer Shields of Stifel Nicolaus downgraded Warren Buffett’s Berkshire Hathaway (NYSE: BRK.B) to "sell” from “hold.”

In his research note for clients, Shields said that BRK’s share price does not reflect a "blah-shaped" economic recovery and that "Our weak macroeconomic outlook implies poor 2H10 earnings" for the company's operating companies."

According to Shields, a weaker economy will affect holdings and derivatives contracts at Berkshire. "Investors' focus on Berkshire's book value for valuation imply that its shares could outpace broader market's declines," he added.

Shields pointed out that Berkshire has gained 20% so far this year, outperforming the S&P 500 stock index, which has fallen 5%. He believes that relationship is "nearing an apex that seems poised for a correction based on the shares' history."

Before the downgrade by Stifel Nicolaus, one analyst had recommended the Berkshire stock as 'buy' and four had placed the 'hold' rating.

More Analyst Ratings here.

Posted-In: Analyst Color News Short Ideas Downgrades Markets Analyst Ratings Media Trading Ideas


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