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Frontline Ltd  (NYSE:FRO) E10: $5.91 (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.

Frontline Ltd's adjusted earnings per share data for the three months ended in Jun. 2017 was $-0.120. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $5.91 for the trailing ten years ended in Jun. 2017.

As of today, Frontline Ltd's current stock price is $5.59. Frontline Ltd's E10 for the quarter that ended in Jun. 2017 was $5.91. Frontline Ltd's Shiller PE Ratio of today is 0.95.

During the past 13 years, the highest Shiller PE Ratio of Frontline Ltd was 9.99. The lowest was 0.32. And the median was 1.00.


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.

Frontline Ltd 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 27.20 24.33 16.96 12.33 8.49

Frontline Ltd 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 10.33 9.55 8.49 7.33 5.91

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, Frontline Ltd'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)
=-0.12/244.955*244.955
=-0.120

Current CPI (Jun. 2017) = 244.955.

Frontline Ltd Quarterly Data

per share eps CPI Adj_EPS
200709 6.950 208.490 8.166
200712 13.400 210.036 15.628
200803 14.750 213.528 16.921
200806 21.250 218.815 23.789
200809 6.950 218.783 7.781
200812 3.050 210.228 3.554
200903 4.900 212.709 5.643
200906 1.800 215.693 2.044
200909 -0.350 215.969 -0.397
200912 0.250 215.949 0.284
201003 5.100 217.631 5.740
201006 5.200 217.965 5.844
201009 0.160 218.439 0.179
201012 7.820 219.179 8.740
201103 1.000 223.467 1.096
201106 -2.250 225.722 -2.442
201109 -10.650 226.889 -11.498
201112 -22.050 225.672 -23.934
201203 0.450 229.392 0.481
201206 -7.700 229.478 -8.219
201209 -3.150 231.407 -3.334
201212 -1.050 229.601 -1.120
201303 -1.200 232.773 -1.263
201306 -7.750 233.504 -8.130
201309 -2.300 234.149 -2.406
201312 11.810 233.049 12.413
201403 -0.650 236.293 -0.674
201406 -4.050 238.343 -4.162
201409 -3.000 238.031 -3.087
201412 8.940 234.812 9.326
201503 0.090 236.119 0.093
201506 0.200 238.638 0.205
201509 0.530 237.945 0.546
201512 0.470 236.525 0.487
201603 0.500 238.132 0.514
201606 0.090 241.018 0.091
201609 0.030 241.428 0.030
201612 0.120 241.432 0.122
201703 0.160 243.801 0.161
201706 -0.120 244.955 -0.120

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.

Frontline Ltd's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=5.59/5.91
=0.95

* 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 Frontline Ltd was 9.99. The lowest was 0.32. And the median was 1.00.


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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