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Aflac Inc  (NYSE:AFL) E10: $5.49 (As of Jun. 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.

Aflac Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was $1.790. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $5.49 for the trailing ten years ended in Jun. 2017.

As of today, Aflac Inc's current stock price is $83.85. Aflac Inc's E10 for the quarter that ended in Jun. 2017 was $5.49. Aflac Inc's Shiller PE Ratio of today is 15.27.

During the past 13 years, the highest Shiller PE Ratio of Aflac Inc was 30.65. The lowest was 5.69. And the median was 14.41.


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.

Aflac Inc Annual Data

Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.69 4.22 4.59 4.87 5.26

Aflac Inc Quarterly Data

Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17
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 5.09 5.15 5.26 5.36 5.49

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, Aflac Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Jun. 2017 (Change)*Current CPI (Jun. 2017)
=1.79/244.955*244.955
=1.790

Current CPI (Jun. 2017) = 244.955.

Aflac Inc Quarterly Data

per share eps CPI Adj_EPS
200709 0.850 208.490 0.999
200712 0.780 210.036 0.910
200803 0.980 213.528 1.124
200806 1.000 218.815 1.119
200809 0.210 218.783 0.235
200812 0.430 210.228 0.501
200903 1.220 212.709 1.405
200906 0.670 215.693 0.761
200909 0.770 215.969 0.873
200912 0.530 215.949 0.601
201003 1.350 217.631 1.519
201006 1.230 217.965 1.382
201009 1.460 218.439 1.637
201012 0.890 219.179 0.995
201103 0.830 223.467 0.910
201106 0.580 225.722 0.629
201109 1.570 226.889 1.695
201112 1.140 225.672 1.237
201203 1.680 229.392 1.794
201206 1.030 229.478 1.099
201209 2.160 231.407 2.286
201212 1.240 229.601 1.323
201303 1.900 232.773 1.999
201306 1.900 233.504 1.993
201309 1.500 234.149 1.569
201312 1.450 233.049 1.524
201403 1.600 236.293 1.659
201406 1.780 238.343 1.829
201409 1.560 238.031 1.605
201412 1.570 234.812 1.638
201503 1.510 236.119 1.567
201506 1.320 238.638 1.355
201509 1.320 237.945 1.359
201512 1.710 236.525 1.771
201603 1.740 238.132 1.790
201606 1.320 241.018 1.342
201609 1.530 241.428 1.552
201612 1.830 241.432 1.857
201703 1.470 243.801 1.477
201706 1.790 244.955 1.790

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.

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

Shiller PE Ratio=Share Price/E10
=83.85/5.49
=15.27

* 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 Aflac Inc was 30.65. The lowest was 5.69. And the median was 14.41.


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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