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Wells Fargo & Co (NYSE:WFC)
Shiller P/E Ratio
16.01 (As of Today)

As of today, Wells Fargo & Co's current share price is $48.51. Wells Fargo & Co's E10 for the quarter that ended in Jun. 2016 was $3.03. Wells Fargo & Co's Shiller P/E Ratio for today is 16.01.

WFC' s Shiller P/E Ratio Range Over the Past 10 Years
Min: 4.6   Max: 23.36
Current: 16.03

4.6
23.36

During the past 13 years, Wells Fargo & Co's highest Shiller P/E Ratio was 23.36. The lowest was 4.60. And the median was 16.05.

WFC's Shiller P/E Ratio is ranked higher than
56% of the 487 Companies
in the Global Banks - Global industry.

( Industry Median: 17.59 vs. WFC: 16.03 )

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.

Wells Fargo & Co's adjusted earnings per share data for the three months ended in Jun. 2016 was $1.010. Add all the adjusted EPS for the past 10 years together and divide 10 will get our E10, which is $3.03 for the trailing ten years ended in Jun. 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.

Wells Fargo & Co's Shiller P/E Ratio for today is calculated as

Shiller P/E Ratio=Share Price/E10
=48.51/3.03
=16.01

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

Wells Fargo & Co's E10 for the fiscal year that ended in Dec15 is calculated as:

For example, Wells Fargo & Co's adjusted earnings per share data for the three months ended in Jun. 2016 was:

Adj_EPS=Earnigns per Share/CPI of Jun. 2016 (Change)*Current CPI (Jun. 2016)
=1.01/241.038*241.038
=1.010

Current CPI (Jun. 2016) = 241.038.

Wells Fargo & Co Quarterly Data

201403201406201409201412201503201506201509201512201603201606
per share eps 1.0501.0101.0201.0201.0401.0301.0501.0000.9901.010
CPI 236.293238.343238.031234.812236.119238.638237.945236.525238.132241.038
Adj_EPS 1.0711.0211.0331.0471.0621.0401.0641.0191.0021.010
201109201112201203201206201209201212201303201306201309201312
per share eps 0.7200.7300.7500.8200.8800.9100.9200.9800.9901.000
CPI 226.889225.672229.392229.478231.407229.601232.773233.504234.149233.049
Adj_EPS 0.7650.7800.7880.8610.9170.9550.9531.0121.0191.034
200903200906200909200912201003201006201009201012201103201106
per share eps 0.5600.5700.5600.0600.4500.5500.6000.6100.6700.700
CPI 212.709215.693215.969215.949217.631217.965218.439219.179223.467225.722
Adj_EPS 0.6350.6370.6250.0670.4980.6080.6620.6710.7230.747
200609200612200703200706200709200712200803200806200809200812
per share eps 0.6400.6200.6600.6700.6800.3700.6000.5300.490-0.930
CPI 202.900201.800205.352208.352208.490210.036213.528218.815218.783210.228
Adj_EPS 0.7600.7410.7750.7750.7860.4250.6770.5840.540-1.066

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 own currency.

Wells Fargo & Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
ShillerPE 22.0516.3716.0814.1315.4912.4514.3017.5019.7718.66

Wells Fargo & Co Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
ShillerPE 18.7019.2918.7819.7719.3519.5717.6518.6616.2915.64
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