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W W Grainger Inc (NYSE:GWW)
Shiller P/E Ratio
25.47 (As of Today)

As of today, W W Grainger Inc's current share price is $234.60. W W Grainger Inc's E10 for the quarter that ended in Dec. 2014 was $9.21. W W Grainger Inc's Shiller P/E Ratio for today is 25.47.

GWW' s 10-Year Shiller P/E Ratio Range
Min: 13.9   Max: 33.98
Current: 25.7

13.9
33.98

During the past 13 years, W W Grainger Inc's highest Shiller P/E Ratio was 33.98. The lowest was 13.90. And the median was 24.33.

GWW's Shiller P/E Ratiois ranked higher than
68% of the 241 Companies
in the Global Industrial Distribution industry.

( Industry Median: 39.85 vs. GWW: 25.70 )

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.

W W Grainger Inc's adjusted earnings per share data for the three months ended in Dec. 2014 was $2.158. 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 $9.21 for the trailing six years ended in Dec. 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.

W W Grainger Inc's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=234.60/9.21
=25.47

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

W W Grainger Inc's E10 for the fiscal year that ended in Dec14 is calculated as:

For example, W W Grainger Inc's adjusted earnings per share data for the three months ended in Dec. 2014 was:

Adj_EPS=Earnigns per Share/CPI of Dec. 2014*CPI of Current
=2.167/234.812*233.808
=2.158

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

Current CPI = 233.808.

W W Grainger Inc Quarterly Data

201209201212201303201306201309201312201403201406201409201412
per share eps 2.1502.2072.9403.0302.9502.2333.0702.9403.3002.167
CPI 231.407229.601232.773233.504234.149233.049236.293238.343238.031234.812
Adj_EPS 2.1722.2472.9533.0342.9462.2403.0382.8843.2412.158
201003201006201009201012201103201106201109201112201203201206
per share eps 1.3101.7302.0601.8722.1802.3402.5102.0802.5702.630
CPI 217.631217.965218.439219.179223.467225.722226.889225.672229.392229.478
Adj_EPS 1.4071.8562.2051.9972.2812.4242.5872.1552.6192.680
200903200906200909200912
per share eps 1.2501.2101.8801.300
CPI 212.709215.693215.969215.949
Adj_EPS 1.3741.3122.0351.408

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.

W W Grainger Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
ShillerPE 25.4622.0723.1518.3919.8925.2329.1327.5730.3327.68

W W Grainger Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
ShillerPE 28.7127.5729.0131.3931.5930.3328.8728.0327.0727.68
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