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AECOM  (NYSE:ACM) E10: $1.46 (As of Sep. 2017)

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.

AECOM's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.550. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.46 for the trailing ten years ended in Sep. 2017.

As of today, AECOM's current stock price is $34.72. AECOM's E10 for the quarter that ended in Sep. 2017 was $1.46. AECOM's Shiller PE Ratio of today is 23.78.

During the past 13 years, the highest Shiller PE Ratio of AECOM was 30.17. The lowest was 16.83. And the median was 22.41.


Historical Data

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

* Premium members only.

AECOM Annual Data

Sep08 Sep09 Sep10 Sep11 Sep12 Sep13 Sep14 Sep15 Sep16 Sep17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.00 1.69 1.37 1.34 1.46

AECOM Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.34 1.33 1.38 1.42 1.46

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


Calculation

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, AECOM's adjusted earnings per share data for the three months ended in Sep. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Sep. 2017 (Change)*Current CPI (Sep. 2017)
=0.55/246.819*246.819
=0.550

Current CPI (Sep. 2017) = 246.819.

AECOM Quarterly Data

per share eps CPI Adj_EPS
200712 0.290 210.036 0.341
200803 0.350 213.528 0.405
200806 0.370 218.815 0.417
200809 0.410 218.783 0.463
200812 0.380 210.228 0.446
200903 0.400 212.709 0.464
200906 0.460 215.693 0.526
200909 0.480 215.969 0.549
200912 0.400 215.949 0.457
201003 0.510 217.631 0.578
201006 0.560 217.965 0.634
201009 0.580 218.439 0.655
201012 0.480 219.179 0.541
201103 0.490 223.467 0.541
201106 0.620 225.722 0.678
201109 0.740 226.889 0.805
201112 0.420 225.672 0.459
201203 0.430 229.392 0.463
201206 0.630 229.478 0.678
201209 -2.000 231.407 -2.133
201212 0.360 229.601 0.387
201303 0.530 232.773 0.562
201306 0.700 233.504 0.740
201309 0.770 234.149 0.812
201312 0.580 233.049 0.614
201403 0.410 236.293 0.428
201406 0.700 238.343 0.725
201409 0.640 238.031 0.664
201412 -0.980 234.812 -1.030
201503 0.002 236.119 0.002
201506 -0.110 238.638 -0.114
201509 0.010 237.945 0.010
201512 -0.130 236.525 -0.136
201603 0.270 238.132 0.280
201606 0.430 241.018 0.440
201609 0.040 241.428 0.041
201612 0.300 241.432 0.307
201703 0.650 243.801 0.658
201706 0.640 244.955 0.645
201709 0.550 246.819 0.550

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 PE 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.

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

Shiller PE Ratio=Share Price/E10
=34.72/1.46
=23.78

* 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 AECOM was 30.17. The lowest was 16.83. And the median was 22.41.


Be Aware

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


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