Switch to:
GuruFocus has detected 5 Warning Signs with DryShips Inc \$DRYS.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
DryShips Inc (NAS:DRYS)
E10
\$178.95 (As of Sep. 2016)

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.

DryShips Inc's adjusted earnings per share data for the three months ended in Sep. 2016 was \$37.909. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is \$178.95 for the trailing ten years ended in Sep. 2016.

As of today, DryShips Inc's current stock price is \$5.40. DryShips Inc's E10 for the quarter that ended in Sep. 2016 was \$178.95. DryShips Inc's Shiller P/E Ratio of today is 0.03.

During the past 13 years, the highest Shiller P/E Ratio of DryShips Inc was 3.34. The lowest was 0.01. And the median was 1.29.

Definition

E10 is a concept invented by Prof. Robert Shiller, who uses E10 for his Shiller P/E calculation. When we calculate the today's Shiller P/E ratio of a stock, we use todays price divided by E10.

What is E10? How do we calculate E10?

E10 is the average of the inflation adjusted earnings of a company over the past 10 years. Lets use an example to explain.

If we want to calculate the E10 of Wal-Mart (WMT) for Dec. 31, 2010, we need to have the inflation data and the earnings from 2001 through 2010.

We adjusted the earnings of 2001 earnings data with the total inflation from 2001 through 2010 to the equivalent earnings in 2010. If the total inflation from 2001 to 2010 is 40%, and Wal-Mart earned \$1 a share in 2001, then the 2001s equivalent earnings in 2010 is \$1.4 a share. If Wal-Mart earns \$1 again in 2002, and the total inflation from 2002 through 2010 is 35%, then the equivalent 2002 earnings in 2010 is \$1.35. So on and so forth, you get the equivalent earnings of past 10 years. Then you add them together and divided the sum by 10 to get E10.

For example, DryShips Inc's adjusted earnings per share data for the three months ended in Sep. 2016 was:

 Adj_EPS = Earnigns per Share / CPI of Sep. 2016 (Change) * Current CPI (Sep. 2016) = 37.909 / 241.428 * 241.428 = 37.909

Current CPI (Sep. 2016) = 241.428.

DryShips Inc Quarterly Data

 201406 201409 201412 201503 201506 201509 201512 201603 201606 201609 per share eps -15.000 60.000 -68.400 -133.799 -3,250.184 -1,850.047 -1,189.538 -240.599 -19.200 37.909 CPI 238.343 238.031 234.812 236.119 238.638 237.945 236.525 238.132 241.018 241.428 Adj_EPS -15.194 60.856 -70.327 -136.807 -3,288.183 -1,877.128 -1,214.196 -243.929 -19.233 37.909 201112 201203 201206 201209 201212 201303 201306 201309 201312 201403 per share eps -30.000 -179.999 -75.000 -194.999 -509.997 -449.998 -75.000 -254.999 -91.800 -119.999 CPI 225.672 229.392 229.478 231.407 229.601 232.773 233.504 234.149 233.049 236.293 Adj_EPS -32.095 -189.443 -78.906 -203.443 -536.268 -466.730 -77.545 -262.926 -95.101 -122.607 200906 200909 200912 201003 201006 201009 201012 201103 201106 201109 per share eps 1,019.995 299.999 119.999 60.000 90.000 314.998 449.998 104.999 -509.997 119.999 CPI 215.693 215.969 215.949 217.631 217.965 218.439 219.179 223.467 225.722 226.889 Adj_EPS 1,141.694 335.364 134.157 66.561 99.688 348.149 495.678 113.438 -545.483 127.689 200612 200703 200706 200709 200712 200803 200806 200809 200812 200903 per share eps 1,634.992 2,864.986 4,659.127 4,379.978 8,099.960 6,869.966 10,634.947 6,089.970 -35,759.821 -1,634.992 CPI 201.800 205.352 208.352 208.490 210.036 213.528 218.815 218.783 210.228 212.709 Adj_EPS 1,956.060 3,368.303 5,398.766 5,071.943 9,310.581 7,767.610 11,733.994 6,720.309 -41,066.947 -1,855.741

Add all the adjusted EPS together and divide 10 will get our e10.

Explanation

If a company grows much fast than inflation, E10 may underestimate the company's earnings power. Shiller P/E Ratio can seem to be too high even the actual P/E is low.

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.

DryShips Inc's Shiller P/E Ratio of today is calculated as

 Shiller P/E Ratio = Share Price / E10 = 5.40 / 178.95 = 0.03

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

During the past 13 years, the highest Shiller P/E Ratio of DryShips Inc was 3.34. The lowest was 0.01. And the median was 1.29.

Be Aware

Shiller P/E Ratio works better for cyclical companies. It gives you a better idea on the company's real earnings power.

Related Terms

Shiller P/E Ratio

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

DryShips Inc Annual Data

 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 e10 0.00 0.00 0.00 0.00 0.00 2,278.56 2,233.82 2,099.74 1,612.88 325.19

DryShips Inc Quarterly Data

 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 e10 1,884.39 1,770.62 1,612.88 1,488.48 920.37 582.62 325.19 196.53 125.18 178.95
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to \$400 per referral. ( Learn More)