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D.R. Horton Inc  (NYSE:DHI) E10: $0.18 (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.

D.R. Horton Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was $0.760. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $0.18 for the trailing ten years ended in Jun. 2017.

As of today, D.R. Horton Inc's current stock price is $42.67. D.R. Horton Inc's E10 for the quarter that ended in Jun. 2017 was $0.18. D.R. Horton Inc's Shiller PE Ratio of today is 237.06.

During the past 13 years, the highest Shiller PE Ratio of D.R. Horton Inc was 238.95. The lowest was 4.43. And the median was 18.67.


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.

D.R. Horton Inc Annual Data

Sep07 Sep08 Sep09 Sep10 Sep11 Sep12 Sep13 Sep14 Sep15 Sep16
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.69 0.57 0.34 -0.02 -0.26

D.R. Horton 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 -0.23 -0.26 -0.24 -0.20 0.18

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, D.R. Horton 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)
=0.76/244.955*244.955
=0.760

Current CPI (Jun. 2017) = 244.955.

D.R. Horton Inc Quarterly Data

per share eps CPI Adj_EPS
200709 -0.160 208.490 -0.188
200712 -0.410 210.036 -0.478
200803 -4.140 213.528 -4.749
200806 -1.260 218.815 -1.411
200809 -2.530 218.783 -2.833
200812 -0.200 210.228 -0.233
200903 -0.340 212.709 -0.392
200906 -0.450 215.693 -0.511
200909 -0.740 215.969 -0.839
200912 0.560 215.949 0.635
201003 0.040 217.631 0.045
201006 0.160 217.965 0.180
201009 -0.030 218.439 -0.034
201012 -0.060 219.179 -0.067
201103 0.090 223.467 0.099
201106 0.090 225.722 0.098
201109 0.120 226.889 0.130
201112 0.090 225.672 0.098
201203 0.130 229.392 0.139
201206 2.220 229.478 2.370
201209 0.300 231.407 0.318
201212 0.200 229.601 0.213
201303 0.320 232.773 0.337
201306 0.420 233.504 0.441
201309 0.400 234.149 0.418
201312 0.360 233.049 0.378
201403 0.380 236.293 0.394
201406 0.320 238.343 0.329
201409 0.450 238.031 0.463
201412 0.390 234.812 0.407
201503 0.400 236.119 0.415
201506 0.600 238.638 0.616
201509 0.640 237.945 0.659
201512 0.420 236.525 0.435
201603 0.520 238.132 0.535
201606 0.660 241.018 0.671
201609 0.750 241.428 0.761
201612 0.550 241.432 0.558
201703 0.600 243.801 0.603
201706 0.760 244.955 0.760

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.

D.R. Horton Inc's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=42.67/0.18
=237.06

* 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 D.R. Horton Inc was 238.95. The lowest was 4.43. And the median was 18.67.


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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