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Arthur J. Gallagher & Co (NYSE:AJG)
Shiller P/E Ratio
28.84 (As of Today)

As of today, Arthur J. Gallagher & Co's current share price is $49.32. Arthur J. Gallagher & Co's E10 for the quarter that ended in Sep. 2016 was $1.71. Arthur J. Gallagher & Co's Shiller P/E Ratio for today is 28.84.

AJG' s Shiller P/E Ratio Range Over the Past 10 Years
Min: 11.53   Max: 33.77
Current: 28.46

11.53
33.77

During the past 13 years, Arthur J. Gallagher & Co's highest Shiller P/E Ratio was 33.77. The lowest was 11.53. And the median was 23.01.

AJG's Shiller P/E Ratio is ranked lower than
66% of the 87 Companies
in the Global Insurance Brokers industry.

( Industry Median: 24.72 vs. AJG: 28.46 )

E10 is a concept invented by Prof. Robert Shiller, who uses E10 for his Shiller P/E calculation. E10 is the average of the inflation adjusted earnings of a company over the past 10 years.

Arthur J. Gallagher & Co's adjusted earnings per share data for the three months ended in Sep. 2016 was $0.690. Add all the adjusted EPS for the past 10 years together and divide 10 will get our E10, which is $1.71 for the trailing ten years ended in Sep. 2016.


Definition

For the Shiller P/E, the earnings of the past 10 years are inflation-adjusted and averaged. The result is used for P/E calculation. Since it looks at the average over the last 10 years, the Shiller P/E is also called PE10.

The Shiller P/E was first used by professor Robert Shiller to measure the valuation of the overall market. The same calculation is applied here to individual companies.

Arthur J. Gallagher & Co's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=49.32/1.71
=28.84

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Arthur J. Gallagher & Co's E10 for the fiscal year that ended in Dec15 is calculated as:

For example, Arthur J. Gallagher & Co's adjusted earnings per share data for the three months ended in Sep. 2016 was:

Adj_EPS=Earnigns per Share/CPI of Sep. 2016 (Change)*Current CPI (Sep. 2016)
=0.69/241.428*241.428
=0.690

Current CPI (Sep. 2016) = 241.428.

Arthur J. Gallagher & Co Quarterly Data

201406201409201412201503201506201509201512201603201606201609
per share eps 0.7000.5800.3000.1300.8100.7500.3400.2600.8400.690
CPI 238.343238.031234.812236.119238.638237.945236.525238.132241.018241.428
Adj_EPS 0.7090.5880.3080.1330.8190.7610.3470.2640.8410.690
201112201203201206201209201212201303201306201309201312201403
per share eps 0.3500.2400.5900.5000.2600.3200.7300.5700.4500.360
CPI 225.672229.392229.478231.407229.601232.773233.504234.149233.049236.293
Adj_EPS 0.3740.2530.6210.5220.2730.3320.7550.5880.4660.368
200906200909200912201003201006201009201012201103201106201109
per share eps 0.4400.4100.1600.2800.4200.4400.5100.1400.3700.410
CPI 215.693215.969215.949217.631217.965218.439219.179223.467225.722226.889
Adj_EPS 0.4920.4580.1790.3110.4650.4860.5620.1510.3960.436
200612200703200706200709200712200803200806200809200812200903
per share eps 0.2500.2000.4400.5400.250-0.0700.4400.4000.0400.270
CPI 201.800205.352208.352208.490210.036213.528218.815218.783210.228212.709
Adj_EPS 0.2990.2350.5100.6250.287-0.0790.4850.4410.0460.306

Add all the adjusted EPS together and divide 10 will get our E10.


Explanation

Compared with the regular P/E ratio, which works poorly for cyclical businesses, the Shiller P/E smoothed out the fluctuations of profit margins during business cycles. Therefore it is more accurate in reflecting the valuation of the company.

If a company has consistent business performance, the Shiller P/E should give similar results to regular P/E.

Compared with the P/S ratio, the Shiller P/E makes the comparison between different industries more meaningful.


Be Aware

The Shiller P/E assumes that over the long term, businesses and profitability revert to their means. If a company’s business model does not work in the future compared with the past, the Shiller P/E and P/S ratio will give false valuations.


Related Terms

P/E Ratio, P/B Ratio, P/S Ratio, Price-to-Free-Cash-Flow ratio, E10


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Arthur J. Gallagher & Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
ShillerPE 23.2317.6619.2516.1219.9523.1323.8531.8132.7725.17

Arthur J. Gallagher & Co Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
ShillerPE 30.8330.5732.7729.8229.6025.8825.1727.2527.9229.69
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