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

As of today, W W Grainger Inc's current share price is $231.04. W W Grainger Inc's E10 for the quarter that ended in Dec. 2014 was $9.27. W W Grainger Inc's Shiller P/E Ratio for today is 24.92.

GWW' s 10-Year Shiller P/E Ratio Range
Min: 13.9   Max: 34.11
Current: 24.93

13.9
34.11

During the past 13 years, W W Grainger Inc's highest Shiller P/E Ratio was 34.11. The lowest was 13.90. And the median was 24.25.

GWW's Shiller P/E Ratiois ranked higher than
69% of the 240 Companies
in the Global Industrial Distribution industry.

( Industry Median: 39.32 vs. GWW: 24.93 )

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 $2.137. 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 $9.27 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
=231.04/9.27
=24.92

* 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
=2.14/235.51*235.189
=2.137

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

Current CPI = 235.189.

W W Grainger Inc Quarterly Data

201209201212201303201306201309201312201403201406201409201412
per share eps 2.1502.2072.9403.0302.9502.2333.0702.9403.3002.140
CPI 231.407229.601232.773233.504234.149233.049236.293238.343238.031235.510
Adj_EPS 2.1852.2612.9713.0522.9632.2543.0562.9013.2612.137
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 1.4161.8672.2182.0092.2942.4382.6022.1682.6352.695
200903200906200909200912
per share eps 1.2501.2101.8801.300
CPI 212.709215.693215.969215.949
Adj_EPS 1.3821.3192.0471.416

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 25.5122.0923.1718.4319.9225.0528.9527.4130.4627.78

W W Grainger Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
ShillerPE 28.8227.4129.1331.5131.4130.4628.9828.1327.4227.78
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