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AeroVironment Inc  (NAS:AVAV) E10: $0.80 (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.

AeroVironment Inc's adjusted earnings per share data for the three months ended in Oct. 2017 was $0.290. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $0.80 for the trailing ten years ended in Oct. 2017.

As of today, AeroVironment Inc's current stock price is $53.34. AeroVironment Inc's E10 for the quarter that ended in Oct. 2017 was $0.80. AeroVironment Inc's Shiller PE Ratio of today is 66.68.

During the past 13 years, the highest Shiller PE Ratio of AeroVironment Inc was 84.48. The lowest was 23.18. And the median was 36.68.


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.

AeroVironment Inc Annual Data

Apr08 Apr09 Apr10 Apr11 Apr12 Apr13 Apr14 Apr15 Apr16 Apr17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.00 1.04 0.97 0.97 0.83

AeroVironment 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 0.80 0.72 0.83 0.80 0.80

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, AeroVironment 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)
=0.29/246.663*246.663
=0.290

Current CPI (Oct. 2017) = 246.663.

AeroVironment Inc Quarterly Data

per share eps CPI Adj_EPS
200801 0.280 211.080 0.327
200804 0.300 214.823 0.344
200807 0.220 219.964 0.247
200810 0.410 216.573 0.467
200901 0.210 211.143 0.245
200904 0.270 213.240 0.312
200907 -0.170 215.351 -0.195
200910 0.100 216.177 0.114
201001 0.300 216.687 0.342
201004 0.710 218.009 0.803
201007 -0.160 218.011 -0.181
201010 0.010 218.711 0.011
201101 0.520 220.223 0.582
201104 0.790 224.906 0.866
201107 0.010 225.922 0.011
201110 0.300 226.421 0.327
201201 0.260 226.665 0.283
201204 0.790 230.085 0.847
201207 -0.060 229.104 -0.065
201210 0.390 231.317 0.416
201301 0.170 230.280 0.182
201304 -0.040 232.531 -0.042
201307 -0.320 233.596 -0.338
201310 0.070 233.546 0.074
201401 0.490 233.916 0.517
201404 0.350 237.072 0.364
201407 -0.160 238.250 -0.166
201410 -0.130 237.433 -0.135
201501 0.100 233.707 0.106
201504 0.310 236.599 0.323
201507 -0.300 238.654 -0.310
201510 0.190 237.838 0.197
201601 0.270 236.916 0.281
201604 0.230 239.261 0.237
201607 -0.510 240.628 -0.523
201610 -0.180 241.729 -0.184
201701 -0.090 242.839 -0.091
201704 1.320 244.524 1.332
201707 -0.190 244.786 -0.191
201710 0.290 246.663 0.290

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.

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

Shiller PE Ratio=Share Price/E10
=53.34/0.80
=66.68

* 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 AeroVironment Inc was 84.48. The lowest was 23.18. And the median was 36.68.


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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