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As of today, KKR Financial Holdings LLC's current share price is $11.54. KKR Financial Holdings LLC's E10 for the quarter that ended in Dec. 2013 was $0.01. KKR Financial Holdings LLC's Shiller P/E Ratio for today is 1,154.00.
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.
KKR Financial Holdings LLC's adjusted earnings per share data for the three months ended in Dec. 2013 was $0.304. Add all the adjusted EPS for the past 10 years together and divide 10 will get our E10, which is $0.01 for the trailing ten years ended in Dec. 2013.
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.
KKR Financial Holdings LLC's Shiller P/E Ratio for today is calculated as
|Shiller P/E Ratio||=||Share Price||/||E10|
KKR Financial Holdings LLC's E10 for the fiscal year that ended in Dec13 is calculated as:
For example, KKR Financial Holdings LLC's adjusted earnings per share data for the three months ended in Dec. 2013 was:
|Adj_EPS||=||Earnigns per Share||/||CPI of Dec. 2013 (Change)||*||Current CPI (Dec. 2013)|
Current CPI (Dec. 2013) = 233.049.
KKR Financial Holdings LLC does not have a history long enough to calculate E10. Therefore GuruFocus does not calculate it.
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.
The Shiller P/E assumes that over the long term, businesses and profitability revert to their means. If a companys business model does not work in the future compared with the past, the Shiller P/E and P/S ratio will give false valuations.
KKR Financial Holdings LLC Annual Data
KKR Financial Holdings LLC Quarterly Data