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National Grid PLC (NYSE:NGG)
Shiller P/E Ratio
16.08 (As of Today)

As of today, National Grid PLC's current share price is $72.20. National Grid PLC's E10 for the quarter that ended in Sep. 2014 was $4.49. National Grid PLC's Shiller P/E Ratio for today is 16.08.

NGG' s 10-Year Shiller P/E Ratio Range
Min: 7.15   Max: 20.73
Current: 16

7.15
20.73

During the past 13 years, National Grid PLC's highest Shiller P/E Ratio was 20.73. The lowest was 7.15. And the median was 11.50.

NGG's Shiller P/E Ratiois ranked higher than
91% of the 987 Companies
in the Global Utilities - Diversified industry.

( Industry Median: 24.65 vs. NGG: 16.00 )

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.

National Grid PLC's adjusted earnings per share data of for the fiscal year that ended in Mar14 was $5.472. 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 $4.49 for the trailing six years ended in Mar14.


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.

National Grid PLC's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=72.20/4.49
=16.08

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

National Grid PLC's E10 for the quarter that ended in Sep. 2014 is calculated as:

For example, National Grid PLC's adjusted earnings per share data for the fiscal year that ended in Mar14 was:

Adj_EPS=Earnigns per Share/CPI of Mar14*CPI of Current
=5.49003322259/236.293*235.51
=5.472

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

Current CPI = 235.51.

National Grid PLC Annual Data

200903201003201103201203201303201403
per share eps 2.3983.7245.1374.4944.6985.490
CPI 212.709217.631223.467229.392232.773236.293
Adj_EPS 2.6554.0305.4144.6144.7545.472

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.

National Grid PLC Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
ShillerPE 16.2813.6519.669.877.338.397.9710.0711.6514.28

National Grid PLC Semi-Annual Data

Mar10Sep10Mar11Sep11Mar12Sep12Mar13Sep13Mar14Sep14
ShillerPE 8.390.007.970.0010.070.0011.650.0014.280.00
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