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General Dynamics Corp  (NYSE:GD) E10: $6.99 (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.

General Dynamics Corp's adjusted earnings per share data for the three months ended in Jun. 2017 was $2.450. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $6.99 for the trailing ten years ended in Jun. 2017.

As of today, General Dynamics Corp's current stock price is $210.39. General Dynamics Corp's E10 for the quarter that ended in Jun. 2017 was $6.99. General Dynamics Corp's Shiller PE Ratio of today is 30.10.

During the past 13 years, the highest Shiller PE Ratio of General Dynamics Corp was 30.52. The lowest was 9.68. And the median was 20.03.


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.

General Dynamics 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 4.83 5.22 5.62 6.15 6.64

General Dynamics 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 6.41 6.50 6.64 6.83 6.99

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, General Dynamics 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)
=2.45/244.955*244.955
=2.450

Current CPI (Jun. 2017) = 244.955.

General Dynamics Corp Quarterly Data

per share eps CPI Adj_EPS
200709 1.340 208.490 1.574
200712 1.430 210.036 1.668
200803 1.420 213.528 1.629
200806 1.600 218.815 1.791
200809 1.590 218.783 1.780
200812 1.570 210.228 1.829
200903 1.530 212.709 1.762
200906 1.600 215.693 1.817
200909 1.470 215.969 1.667
200912 1.570 215.949 1.781
201003 1.530 217.631 1.722
201006 1.670 217.965 1.877
201009 1.700 218.439 1.906
201012 1.910 219.179 2.135
201103 1.640 223.467 1.798
201106 1.760 225.722 1.910
201109 1.800 226.889 1.943
201112 1.680 225.672 1.824
201203 1.570 229.392 1.677
201206 1.770 229.478 1.889
201209 1.700 231.407 1.800
201212 -6.020 229.601 -6.423
201303 1.620 232.773 1.705
201306 1.810 233.504 1.899
201309 1.840 234.149 1.925
201312 1.400 233.049 1.472
201403 1.710 236.293 1.773
201406 1.580 238.343 1.624
201409 2.060 238.031 2.120
201412 2.080 234.812 2.170
201503 2.140 236.119 2.220
201506 2.270 238.638 2.330
201509 2.280 237.945 2.347
201512 2.400 236.525 2.486
201603 2.040 238.132 2.098
201606 2.300 241.018 2.338
201609 2.210 241.428 2.242
201612 2.580 241.432 2.618
201703 2.480 243.801 2.492
201706 2.450 244.955 2.450

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.

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

Shiller PE Ratio=Share Price/E10
=210.39/6.99
=30.10

* 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 General Dynamics Corp was 30.52. The lowest was 9.68. And the median was 20.03.


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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