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Sherwin-Williams Co (NYSE:SHW)
Shiller P/E Ratio
49.94 (As of Today)

As of today, Sherwin-Williams Co's current share price is $289.17. Sherwin-Williams Co's E10 for the quarter that ended in Sep. 2014 was $5.79. Sherwin-Williams Co's Shiller P/E Ratio for today is 49.94.

SHW' s 10-Year Shiller P/E Ratio Range
Min: 11.52   Max: 50.04
Current: 49.9

11.52
50.04

During the past 13 years, Sherwin-Williams Co's highest Shiller P/E Ratio was 50.04. The lowest was 11.52. And the median was 23.83.

SHW's Shiller P/E Ratiois ranked higher than
72% of the 1181 Companies
in the Global Specialty Chemicals industry.

( Industry Median: 47.68 vs. SHW: 49.90 )

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.

Sherwin-Williams Co's adjusted earnings per share data for the three months ended in Sep. 2014 was $3.291. 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 $5.79 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.

Sherwin-Williams Co's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=289.17/5.79
=49.94

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

Sherwin-Williams Co's E10 for the fiscal year that ended in Dec13 is calculated as:

For example, Sherwin-Williams Co'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
=3.35/238.031*233.808
=3.291

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

Current CPI = 233.808.

Sherwin-Williams Co Quarterly Data

201209201212201303201306201309201312201403201406201409201412
per share eps 2.2400.6681.1102.4602.5501.1671.1402.9403.3501.370
CPI 231.407229.601232.773233.504234.149233.049236.293238.343238.031234.812
Adj_EPS 2.2630.6801.1152.4632.5461.1711.1282.8843.2911.364
201003201006201009201012201103201106201109201112201203201206
per share eps 0.3001.6401.6000.6760.6301.6601.7100.1430.9502.170
CPI 217.631217.965218.439219.179223.467225.722226.889225.672229.392229.478
Adj_EPS 0.3221.7591.7130.7210.6591.7191.7620.1480.9682.211
200903200906200909200912
per share eps 0.3201.3501.5100.597
CPI 212.709215.693215.969215.949
Adj_EPS 0.3521.4631.6350.646

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.

Sherwin-Williams Co Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
ShillerPE 24.1324.5918.1616.2015.5019.9620.3932.8935.9345.15

Sherwin-Williams Co Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
ShillerPE 31.3532.8935.2035.8636.0035.9337.7037.5637.7945.15
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