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FirstEnergy Corp  (NYSE:FE) E10: $0.69 (As of Sep. 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.

FirstEnergy Corp's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.890. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $0.69 for the trailing ten years ended in Sep. 2017.

As of today, FirstEnergy Corp's current stock price is $34.65. FirstEnergy Corp's E10 for the quarter that ended in Sep. 2017 was $0.69. FirstEnergy Corp's Shiller PE Ratio of today is 50.22.

During the past 13 years, the highest Shiller PE Ratio of FirstEnergy Corp was 50.22. The lowest was 9.71. And the median was 13.40.


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.

FirstEnergy 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 3.17 3.15 2.89 2.74 0.89

FirstEnergy Corp Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
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 2.35 0.89 0.83 0.75 0.69

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, FirstEnergy Corp's adjusted earnings per share data for the three months ended in Sep. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Sep. 2017 (Change)*Current CPI (Sep. 2017)
=0.89/246.819*246.819
=0.890

Current CPI (Sep. 2017) = 246.819.

FirstEnergy Corp Quarterly Data

per share eps CPI Adj_EPS
200712 0.870 210.036 1.022
200803 0.900 213.528 1.040
200806 0.850 218.815 0.959
200809 1.540 218.783 1.737
200812 1.090 210.228 1.280
200903 0.390 212.709 0.453
200906 1.360 215.693 1.556
200909 0.770 215.969 0.880
200912 0.780 215.949 0.892
201003 0.510 217.631 0.578
201006 0.870 217.965 0.985
201009 0.590 218.439 0.667
201012 0.460 219.179 0.518
201103 0.150 223.467 0.166
201106 0.480 225.722 0.525
201109 1.270 226.889 1.382
201112 0.210 225.672 0.230
201203 0.730 229.392 0.785
201206 0.450 229.478 0.484
201209 1.010 231.407 1.077
201212 -0.350 229.601 -0.376
201303 0.470 232.773 0.498
201306 -0.390 233.504 -0.412
201309 0.520 234.149 0.548
201312 0.340 233.049 0.360
201403 0.490 236.293 0.512
201406 0.150 238.343 0.155
201409 0.790 238.031 0.819
201412 -0.730 234.812 -0.767
201503 0.530 236.119 0.554
201506 0.440 238.638 0.455
201509 0.930 237.945 0.965
201512 -0.540 236.525 -0.564
201603 0.770 238.132 0.798
201606 -2.560 241.018 -2.622
201609 0.890 241.428 0.910
201612 -13.590 241.432 -13.893
201703 0.460 243.801 0.466
201706 0.390 244.955 0.393
201709 0.890 246.819 0.890

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.

FirstEnergy Corp's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=34.65/0.69
=50.22

* 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 FirstEnergy Corp was 50.22. The lowest was 9.71. And the median was 13.40.


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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