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Capital One Financial Corp  (NYSE:COF) E10: $5.46 (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.

Capital One Financial Corp's adjusted earnings per share data for the three months ended in Jun. 2017 was $1.940. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $5.46 for the trailing ten years ended in Jun. 2017.

As of today, Capital One Financial Corp's current stock price is $88.88. Capital One Financial Corp's E10 for the quarter that ended in Jun. 2017 was $5.46. Capital One Financial Corp's Shiller PE Ratio of today is 16.28.

During the past 13 years, the highest Shiller PE Ratio of Capital One Financial Corp was 19.93. The lowest was 1.91. And the median was 11.13.


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.

Capital One Financial Corp 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 5.43 5.56 5.59 5.53 5.42

Capital One Financial Corp 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 5.44 5.40 5.42 5.44 5.46

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, Capital One Financial Corp'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)
=1.94/244.955*244.955
=1.940

Current CPI (Jun. 2017) = 244.955.

Capital One Financial Corp Quarterly Data

per share eps CPI Adj_EPS
200709 -0.210 208.490 -0.247
200712 0.620 210.036 0.723
200803 1.470 213.528 1.686
200806 1.210 218.815 1.355
200809 1.000 218.783 1.120
200812 -3.910 210.228 -4.556
200903 -0.440 212.709 -0.507
200906 -0.660 215.693 -0.750
200909 0.870 215.969 0.987
200912 0.870 215.949 0.987
201003 1.400 217.631 1.576
201006 1.330 217.965 1.495
201009 1.760 218.439 1.974
201012 1.520 219.179 1.699
201103 2.210 223.467 2.423
201106 1.970 225.722 2.138
201109 1.770 226.889 1.911
201112 0.830 225.672 0.901
201203 2.720 229.392 2.905
201206 0.160 229.478 0.171
201209 2.010 231.407 2.128
201212 1.360 229.601 1.451
201303 1.770 232.773 1.863
201306 1.850 233.504 1.941
201309 1.840 234.149 1.925
201312 1.430 233.049 1.503
201403 1.960 236.293 2.032
201406 2.040 238.343 2.097
201409 1.860 238.031 1.914
201412 1.730 234.812 1.805
201503 2.000 236.119 2.075
201506 1.500 238.638 1.540
201509 1.980 237.945 2.038
201512 1.590 236.525 1.647
201603 1.840 238.132 1.893
201606 1.690 241.018 1.718
201609 1.900 241.428 1.928
201612 1.470 241.432 1.491
201703 1.540 243.801 1.547
201706 1.940 244.955 1.940

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.

Capital One Financial Corp's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=88.88/5.46
=16.28

* 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 Capital One Financial Corp was 19.93. The lowest was 1.91. And the median was 11.13.


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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