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A O Smith Corp (NYSE:AOS)
Shiller P/E Ratio
30.28 (As of Today)

As of today, A O Smith Corp's current share price is $56.62. A O Smith Corp's E10 for the quarter that ended in Sep. 2014 was $1.87. A O Smith Corp's Shiller P/E Ratio for today is 30.28.

AOS' s 10-Year Shiller P/E Ratio Range
Min: 10.33   Max: 38.14
Current: 30.24

10.33
38.14

During the past 13 years, A O Smith Corp's highest Shiller P/E Ratio was 38.14. The lowest was 10.33. And the median was 19.71.

AOS's Shiller P/E Ratiois ranked higher than
81% of the 2168 Companies
in the Global Diversified Industrials industry.

( Industry Median: 69.38 vs. AOS: 30.24 )

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.

A O Smith Corp's adjusted earnings per share data for the three months ended in Sep. 2014 was $0.554. Since most companies do not have as long as 10 years history, here we use 6 years to calculate. Add all the adjusted EPS for the past 6 years together and divide 6 will get our E10, which is $1.87 for the trailing six years ended in Sep. 2014.


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.

A O Smith Corp's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=56.62/1.87
=30.28

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

A O Smith Corp's E10 for the fiscal year that ended in Dec13 is calculated as:

For example, A O Smith Corp's adjusted earnings per share data for the three months ended in Sep. 2014 was:

Adj_EPS=Earnigns per Share/CPI of Sep. 2014*CPI of Current
=0.56/238.031*235.51
=0.554

Since most companies do not have as long as 10 years history, GuruFocus uses 6 years to do the calculation.

Current CPI = 235.51.

A O Smith Corp Quarterly Data

201206201209201212201303201306201309201312201403201406201409
per share eps 0.3800.4000.4220.4200.4500.5000.4610.5100.6300.560
CPI 229.478231.407229.601232.773233.504234.149233.049236.293238.343238.031
Adj_EPS 0.3900.4070.4330.4250.4540.5030.4660.5080.6230.554
200912201003201006201009201012201103201106201109201112201203
per share eps 0.2840.3350.1800.3450.3470.4400.5401.9550.3450.510
CPI 215.949217.631217.965218.439219.179223.467225.722226.889225.672229.392
Adj_EPS 0.3100.3630.1940.3720.3730.4640.5632.0290.3600.524
200812200903200906200909
per share eps 0.0740.0930.2800.380
CPI 210.228212.709215.693215.969
Adj_EPS 0.0830.1030.3060.414

Add all the adjusted EPS together and divide 6 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 own currency.

A O Smith Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
ShillerPE 19.8023.9022.4816.6713.6418.0720.2314.1620.2231.39

A O Smith Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
ShillerPE 16.3418.6520.2222.7022.1026.9731.3925.9026.8525.67
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