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As of today, WellPoint Inc's current share price is $116.52. WellPoint Inc's E10 for the quarter that ended in Jun. 2014 was $8.45. WellPoint Inc's Shiller P/E Ratio for today is 13.80.
During the past 13 years, WellPoint Inc's highest Shiller P/E Ratio was 22.82. The lowest was 6.74. And the median was 10.29.
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.
WellPoint Inc's adjusted earnings per share data for the three months ended in Jun. 2014 was $2.570. 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 $8.45 for the trailing six years ended in Jun. 2014.
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.
WellPoint Inc's Shiller P/E Ratio for today is calculated as
|Shiller P/E Ratio||=||Share Price||/||E10|
WellPoint Inc's E10 for the fiscal year that ended in Dec13 is calculated as:
For example, WellPoint Inc's adjusted earnings per share data for the three months ended in Jun. 2014 was:
|Adj_EPS||=||Earnigns per Share||/||CPI of Jun. 2014||*||CPI of Current|
Since most companies do not have as long as 10 years history, here we use 6 years to calculate:
Current CPI = 239.229.
WellPoint Inc Quarterly Data
|per share eps||2.530||1.940||2.150||1.512||2.890||2.640||2.160||0.491||2.400||2.560|
|per share eps||1.530||5.948||1.960||1.710||1.840||1.396||2.440||1.890||1.900||0.959|
|per share eps||1.600||0.652||1.160||1.430|
Add all the adjusted EPS together and divide 6 will get our E10.
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.
The Shiller P/E assumes that over the long term, businesses and profitability revert to their means. If a companys business model does not work in the future compared with the past, the Shiller P/E and P/S ratio will give false valuations.
WellPoint Inc Annual Data
WellPoint Inc Quarterly Data