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As of today, CarMax Inc's current share price is $59.96. CarMax Inc's E10 for the quarter that ended in May. 2015 was $1.57. CarMax Inc's Shiller P/E Ratio for today is 38.19.
During the past 13 years, CarMax Inc's highest Shiller P/E Ratio was 77.77. The lowest was 12.78. And the median was 36.75.
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.
CarMax Inc's adjusted earnings per share data for the three months ended in May. 2015 was $0.860. Add all the adjusted EPS for the past 10 years together and divide 10 will get our E10, which is $1.57 for the trailing ten years ended in May. 2015.
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.
CarMax Inc's Shiller P/E Ratio for today is calculated as
|Shiller P/E Ratio||=||Share Price||/||E10|
CarMax Inc's E10 for the fiscal year that ended in Feb15 is calculated as:
For example, CarMax Inc's adjusted earnings per share data for the three months ended in May. 2015 was:
|Adj_EPS||=||Earnigns per Share||/||CPI of May. 2015 (Change)||*||Current CPI (May. 2015)|
Current CPI (May. 2015) = 237.805.
CarMax Inc Quarterly Data
|per share eps||0.640||0.620||0.470||0.438||0.760||0.700||0.600||0.672||0.860||0.820|
|per share eps||0.360||0.375||0.540||0.480||0.360||0.411||0.520||0.480||0.410||0.464|
|per share eps||0.130||0.060||-0.100||0.172||0.130||0.460||0.330||0.335||0.440||0.480|
|per share eps||0.110||0.237||0.265||0.250||0.210||0.192||0.300||0.290||0.140||0.099|
Add all the adjusted EPS together and divide 10 will get our E10.
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.
CarMax Inc Annual Data
CarMax Inc Quarterly Data