Switch to:
Herbalife Ltd  (NYSE:HLF) E10: $3.38 (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.

Herbalife Ltd's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.660. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $3.38 for the trailing ten years ended in Sep. 2017.

As of today, Herbalife Ltd's current stock price is $73.78. Herbalife Ltd's E10 for the quarter that ended in Sep. 2017 was $3.38. Herbalife Ltd's Shiller PE Ratio of today is 21.83.

During the past 13 years, the highest Shiller PE Ratio of Herbalife Ltd was 37.88. The lowest was 12.10. And the median was 20.47.


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.

Herbalife 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 0.00 2.15 2.52 2.86 3.10

Herbalife Ltd 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 3.02 3.10 3.20 3.32 3.38

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, Herbalife Ltd'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)
=0.66/246.819*246.819
=0.660

Current CPI (Sep. 2017) = 246.819.

Herbalife Ltd Quarterly Data

per share eps CPI Adj_EPS
200712 0.380 210.036 0.447
200803 0.465 213.528 0.537
200806 0.505 218.815 0.570
200809 0.445 218.783 0.502
200812 0.265 210.228 0.311
200903 0.335 212.709 0.389
200906 0.385 215.693 0.441
200909 0.455 215.969 0.520
200912 0.440 215.949 0.503
201003 0.415 217.631 0.471
201006 0.650 217.965 0.736
201009 0.630 218.439 0.712
201012 0.630 219.179 0.709
201103 0.700 223.467 0.773
201106 0.880 225.722 0.962
201109 0.870 226.889 0.946
201112 0.880 225.672 0.962
201203 0.880 229.392 0.947
201206 1.090 229.478 1.172
201209 0.980 231.407 1.045
201212 0.990 229.601 1.064
201303 1.100 232.773 1.166
201306 1.340 233.504 1.416
201309 1.320 234.149 1.391
201312 1.160 233.049 1.229
201403 0.740 236.293 0.773
201406 1.310 238.343 1.357
201409 0.130 238.031 0.135
201412 1.180 234.812 1.240
201503 0.920 236.119 0.962
201506 0.970 238.638 1.003
201509 1.090 237.945 1.131
201512 0.980 236.525 1.023
201603 1.120 238.132 1.161
201606 -0.280 241.018 -0.287
201609 1.010 241.428 1.033
201612 1.150 241.432 1.176
201703 0.980 243.801 0.992
201706 1.610 244.955 1.622
201709 0.660 246.819 0.660

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.

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

Shiller PE Ratio=Share Price/E10
=73.78/3.38
=21.83

* 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 Herbalife Ltd was 37.88. The lowest was 12.10. And the median was 20.47.


Be Aware

Shiller PE Ratio works better for cyclical companies. It gives you a better idea on the company's real earnings power.


Related Terms


Headlines

No Headline

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)

GF Chat

{{numOfNotice}}
FEEDBACK