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Novo Nordisk A/S (NYSE:NVO)
Shiller P/E Ratio
38.50 (As of Today)

As of today, Novo Nordisk A/S's current share price is $44.93. Novo Nordisk A/S's E10 for the quarter that ended in Sep. 2014 was $1.25. Novo Nordisk A/S's Shiller P/E Ratio for today is 38.50.

NVO' s 10-Year Shiller P/E Ratio Range
Min: 18.87   Max: 43.23
Current: 38.5

18.87
43.23

During the past 13 years, Novo Nordisk A/S's highest Shiller P/E Ratio was 43.23. The lowest was 18.87. And the median was 30.66.

NVO's Shiller P/E Ratiois ranked higher than
97% of the 1323 Companies
in the Global Biotechnology industry.

( Industry Median: 9999.00 vs. NVO: 38.50 )

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.

Novo Nordisk A/S's adjusted earnings per share data for the three months ended in Sep. 2014 was $0.421. 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 $1.25 for the trailing six years ended in Sep. 2014.


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.

Novo Nordisk A/S's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=44.93/1.25
=35.94

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

Novo Nordisk A/S's E10 for the fiscal year that ended in Dec13 is calculated as:

For example, Novo Nordisk A/S's adjusted earnings per share data for the three months ended in Sep. 2014 was:

Adj_EPS=Earnigns per Share/CPI of Sep. 2014*CPI of Current
=0.420618837593/238.031*238.389
=0.421

Since most companies do not have as long as 10 years history, here we use 6 years to calculate:

Current CPI = 238.389.

Novo Nordisk A/S Quarterly Data

201206201209201212201303201306201309201312201403201406201409
per share eps 0.3190.3590.3760.3840.4370.4380.4140.4500.4830.421
CPI 229.478231.407229.601232.773233.504234.149233.049236.293238.343238.031
Adj_EPS 0.3320.3700.3900.3930.4460.4460.4240.4530.4830.421
200912201003201006201009201012201103201106201109201112201203
per share eps 0.1500.2020.2070.2290.2450.2740.2760.2730.2730.294
CPI 215.949217.631217.965218.439219.179223.467225.722226.889225.672229.392
Adj_EPS 0.1650.2220.2260.2500.2660.2920.2920.2860.2880.306
200812200903200906200909
per share eps 0.1340.1560.1860.182
CPI 210.228212.709215.693215.969
Adj_EPS 0.1520.1750.2050.201

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.

Novo Nordisk A/S Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
ShillerPE 23.1523.1327.9635.6023.7624.9139.0233.3437.0132.55

Novo Nordisk A/S Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
ShillerPE 38.0238.6237.0135.5732.3832.3532.5538.3037.4740.95
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