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McDonald's Corp (NYSE:MCD)
Shiller PE Ratio
28.92 (As of Today)

As of today, McDonald's Corp's current share price is $141.69. McDonald's Corp's E10 for the quarter that ended in Dec. 2016 was $4.90. McDonald's Corp's Shiller P/E Ratio for today is 28.92.

MCD' s Shiller PE Ratio Range Over the Past 10 Years
Min: 20.63   Max: 34.92
Current: 28.94

20.63
34.92

During the past 13 years, McDonald's Corp's highest Shiller P/E Ratio was 34.92. The lowest was 20.63. And the median was 26.84.

MCD's Shiller PE Ratio is ranked higher than
62% of the 68 Companies
in the Global Restaurants industry.

( Industry Median: 29.52 vs. MCD: 28.94 )

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.

McDonald's Corp's adjusted earnings per share data for the three months ended in Dec. 2016 was $1.430. Add all the adjusted EPS for the past 10 years together and divide 10 will get our E10, which is $4.90 for the trailing ten years ended in Dec. 2016.


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.

McDonald's Corp's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=141.69/4.90
=28.92

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

McDonald's Corp's E10 for the fiscal year that ended in Dec16 is calculated as:

For example, McDonald's Corp's adjusted earnings per share data for the three months ended in Dec. 2016 was:

Adj_EPS=Earnigns per Share/CPI of Dec. 2016 (Change)*Current CPI (Dec. 2016)
=1.43/241.432*241.432
=1.430

Current CPI (Dec. 2016) = 241.432.

McDonald's Corp Quarterly Data

201409201412201503201506201509201512201603201606201609201612
per share eps 1.0901.1300.8401.2601.4001.3101.2301.2501.5001.430
CPI 238.031234.812236.119238.638237.945236.525238.132241.018241.428241.432
Adj_EPS 1.1061.1620.8591.2751.4211.3371.2471.2521.5001.430
201203201206201209201212201303201306201309201312201403201406
per share eps 1.2301.3201.4301.3801.2601.3801.5201.3901.2101.400
CPI 229.392229.478231.407229.601232.773233.504234.149233.049236.293238.343
Adj_EPS 1.2951.3891.4921.4511.3071.4271.5671.4401.2361.418
200909200912201003201006201009201012201103201106201109201112
per share eps 1.1501.1101.0001.1301.2901.1601.1501.3501.4501.330
CPI 215.969215.949217.631217.965218.439219.179223.467225.722226.889225.672
Adj_EPS 1.2861.2411.1091.2521.4261.2781.2421.4441.5431.423
200703200706200709200712200803200806200809200812200903200906
per share eps 0.620-0.6000.8901.0600.8101.0401.0500.8700.8700.980
CPI 205.352208.352208.490210.036213.528218.815218.783210.228212.709215.693
Adj_EPS 0.729-0.6951.0311.2180.9161.1471.1590.9990.9871.097

Add all the adjusted EPS together and divide 10 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 local exchange's currency.

McDonald's Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ShillerPE 33.2031.0827.3229.5232.9924.8824.3521.8925.9424.86

McDonald's Corp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ShillerPE 22.3321.8922.4721.3521.9925.9427.2125.3023.9124.86
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