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Tata Motors Ltd (NYSE:TTM)
E10
\$1.80 (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.

Tata Motors Ltd's adjusted earnings per share data for the three months ended in Sep. 2016 was \$0.181. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is \$1.80 for the trailing ten years ended in Sep. 2016.

As of today, Tata Motors Ltd's current stock price is \$35.67. Tata Motors Ltd's E10 for the quarter that ended in Sep. 2016 was \$1.80. Tata Motors Ltd's Shiller P/E Ratio of today is 19.82.

During the past 13 years, the highest Shiller P/E Ratio of Tata Motors Ltd was 23.87. The lowest was 13.51. And the median was 18.72.

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, Tata Motors Ltd'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) = 0.181371770158 / 241.428 * 241.428 = 0.181

Current CPI (Sep. 2016) = 241.428.

Tata Motors Ltd Quarterly Data

 201409 201412 201503 201506 201509 201512 201603 201606 201609 201612 per share eps 0.829 0.624 0.421 0.653 -0.392 0.775 0.829 0.488 0.181 0.019 CPI 238.031 234.812 236.119 238.638 237.945 236.525 238.132 241.018 241.428 241.432 Adj_EPS 0.841 0.642 0.43 0.661 -0.398 0.791 0.84 0.489 0.181 0.019 201203 201206 201209 201212 201303 201306 201309 201312 201403 201406 per share eps 1.264 0.631 0.588 0.459 1.124 0.456 0.854 1.193 0.987 1.388 CPI 229.392 229.478 231.407 229.601 232.773 233.504 234.149 233.049 236.293 238.343 Adj_EPS 1.33 0.664 0.613 0.483 1.166 0.471 0.881 1.236 1.008 1.406 200712 200803 200903 200912 201003 201006 201009 201012 201103 201112 per share eps 0.225 0.577 -3.161 0.234 1.426 0.683 0.773 0.806 2.933 0.976 CPI 210.036 213.528 212.709 215.949 217.631 217.965 218.439 219.179 223.467 225.672 Adj_EPS 0.259 0.653 -3.588 0.261 1.581 0.757 0.854 0.888 3.169 1.045 200506 200509 200512 200603 200606 200609 200612 200703 200706 200709 per share eps 0.215 0.216 0.213 0.179 0.237 0.236 0.245 0.24 0.219 0.22 CPI 194.5 198.8 196.8 199.8 202.9 202.9 201.8 205.352 208.352 208.49 Adj_EPS 0.267 0.262 0.261 0.217 0.282 0.28 0.293 0.283 0.254 0.255

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.

Tata Motors Ltd's Shiller P/E Ratio of today is calculated as

 Shiller P/E Ratio = Share Price / E10 = 35.67 / 1.80 = 19.82

* 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 Tata Motors Ltd was 23.87. The lowest was 13.51. And the median was 18.72.

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.

Tata Motors Ltd Annual Data

 Mar07 Mar08 Mar09 Mar10 Mar11 Mar12 Mar13 Mar14 Mar15 Mar16 e10 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1.73

Tata Motors Ltd Quarterly Data

 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 e10 0.00 0.00 0.00 1.80 1.63 1.67 1.73 1.81 1.80 1.73
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