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Analog Devices Inc  (NAS:ADI) E10: $2.37 (As of Oct. 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.

Analog Devices Inc's adjusted earnings per share data for the three months ended in Oct. 2017 was $0.970. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $2.37 for the trailing ten years ended in Oct. 2017.

As of today, Analog Devices Inc's current stock price is $93.10. Analog Devices Inc's E10 for the quarter that ended in Oct. 2017 was $2.37. Analog Devices Inc's Shiller PE Ratio of today is 39.28.

During the past 13 years, the highest Shiller PE Ratio of Analog Devices Inc was 39.28. The lowest was 11.99. And the median was 24.58.


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.

Analog Devices Inc Annual Data

Oct08 Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Oct15 Oct16 Oct17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.00 2.06 2.14 2.29 2.36

Analog Devices Inc Quarterly Data

Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17
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 2.29 2.30 2.31 2.31 2.37

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, Analog Devices Inc's adjusted earnings per share data for the three months ended in Oct. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Oct. 2017 (Change)*Current CPI (Oct. 2017)
=0.97/246.663*246.663
=0.970

Current CPI (Oct. 2017) = 246.663.

Analog Devices Inc Quarterly Data

per share eps CPI Adj_EPS
200801 1.220 211.080 1.426
200804 0.450 214.823 0.517
200807 0.470 219.964 0.527
200810 0.500 216.573 0.569
200901 0.090 211.143 0.105
200904 0.180 213.240 0.208
200907 0.220 215.351 0.252
200910 0.360 216.177 0.411
201001 0.400 216.687 0.455
201004 0.550 218.009 0.622
201007 0.650 218.011 0.735
201010 0.740 218.711 0.835
201101 0.720 220.223 0.806
201104 0.780 224.906 0.855
201107 0.710 225.922 0.775
201110 0.600 226.421 0.654
201201 0.460 226.665 0.501
201204 0.530 230.085 0.568
201207 0.560 229.104 0.603
201210 0.590 231.317 0.629
201301 0.420 230.280 0.450
201304 0.520 232.531 0.552
201307 0.560 233.596 0.591
201310 0.630 233.546 0.665
201401 0.480 233.916 0.506
201404 0.590 237.072 0.614
201407 0.570 238.250 0.590
201410 0.340 237.433 0.353
201501 0.570 233.707 0.602
201504 0.650 236.599 0.678
201507 0.680 238.654 0.703
201510 0.310 237.838 0.322
201601 0.520 236.916 0.541
201604 0.550 239.261 0.567
201607 0.740 240.628 0.759
201610 0.950 241.729 0.969
201701 0.690 242.839 0.701
201704 0.270 244.524 0.272
201707 0.180 244.786 0.181
201710 0.970 246.663 0.970

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.

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

Shiller PE Ratio=Share Price/E10
=93.10/2.37
=39.28

* 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 Analog Devices Inc was 39.28. The lowest was 11.99. And the median was 24.58.


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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