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

As of today, W W Grainger Inc's current share price is $246.60. W W Grainger Inc's E10 for the quarter that ended in Mar. 2015 was $9.62. W W Grainger Inc's Shiller P/E Ratio for today is 25.63.

GWW' s 10-Year Shiller P/E Ratio Range
Min: 13.93   Max: 34.16
Current: 25.5

13.93
34.16

During the past 13 years, W W Grainger Inc's highest Shiller P/E Ratio was 34.16. The lowest was 13.93. And the median was 24.40.

GWW's Shiller P/E Ratiois ranked higher than
70% of the 304 Companies
in the Global Industrial Distribution industry.

( Industry Median: 93.49 vs. GWW: 25.50 )

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 Mar. 2015 was $3.084. 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 $9.62 for the trailing six years ended in Mar. 2015.


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
=246.60/9.62
=25.63

* 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 Mar. 2015 was:

Adj_EPS=Earnigns per Share/CPI of Mar. 2015*CPI of Current
=3.07/236.119*237.167
=3.084

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

Current CPI = 237.167.

W W Grainger Inc Quarterly Data

201212201303201306201309201312201403201406201409201412201503
per share eps 2.2072.9403.0302.9502.2333.0702.9403.3002.1673.070
CPI 229.601232.773233.504234.149233.049236.293238.343238.031234.812236.119
Adj_EPS 2.2802.9953.0782.9882.2723.0812.9253.2882.1893.084
201006201009201012201103201106201109201112201203201206201209
per share eps 1.7302.0601.8722.1802.3402.5102.0802.5702.6302.150
CPI 217.965218.439219.179223.467225.722226.889225.672229.392229.478231.407
Adj_EPS 1.8822.2372.0262.3142.4592.6242.1862.6572.7182.204
200906200909200912201003
per share eps 1.2101.8801.3001.310
CPI 215.693215.969215.949217.631
Adj_EPS 1.3302.0651.4281.428

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 25.5022.1023.1918.4519.9525.0828.9827.4730.5127.55

W W Grainger Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
ShillerPE 27.4729.1831.5731.4730.5128.7528.1927.2127.5524.51
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