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Starwood Hotels & Resorts Worldwide Inc  (NYSE:HOT) E10: $2.46 (As of Jun. 2016)

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.

Starwood Hotels & Resorts Worldwide Inc's adjusted earnings per share data for the three months ended in Jun. 2016 was $-1.560. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $2.46 for the trailing ten years ended in Jun. 2016.

As of today, Starwood Hotels & Resorts Worldwide Inc's current stock price is $77.05. Starwood Hotels & Resorts Worldwide Inc's E10 for the quarter that ended in Jun. 2016 was $2.46. Starwood Hotels & Resorts Worldwide Inc's Shiller PE Ratio of today is 31.32.


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.

Starwood Hotels & Resorts Worldwide Inc Annual Data

Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.31 2.48 2.65 2.78 2.87

Starwood Hotels & Resorts Worldwide Inc Quarterly Data

Sep11 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16
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 2.85 2.88 2.87 2.95 2.46

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, Starwood Hotels & Resorts Worldwide Inc's adjusted earnings per share data for the three months ended in Jun. 2016 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Jun. 2016 (Change)*Current CPI (Jun. 2016)
=-1.56/241.018*241.018
=-1.560

Current CPI (Jun. 2016) = 241.018.

Starwood Hotels & Resorts Worldwide Inc Quarterly Data

per share eps CPI Adj_EPS
200609 0.710 202.900 0.843
200612 0.950 201.800 1.135
200703 0.560 205.352 0.657
200706 0.670 208.352 0.775
200709 0.610 208.490 0.705
200712 0.730 210.036 0.838
200803 0.170 213.528 0.192
200806 0.560 218.815 0.617
200809 0.620 218.783 0.683
200812 0.440 210.228 0.504
200903 0.030 212.709 0.034
200906 0.740 215.693 0.827
200909 0.220 215.969 0.246
200912 -0.590 215.949 -0.658
201003 0.160 217.631 0.177
201006 0.610 217.965 0.675
201009 -0.030 218.439 -0.033
201012 1.780 219.179 1.957
201103 0.140 223.467 0.151
201106 0.680 225.722 0.726
201109 0.840 226.889 0.892
201112 0.850 225.672 0.908
201203 0.650 229.392 0.683
201206 0.620 229.478 0.651
201209 0.870 231.407 0.906
201212 0.720 229.601 0.756
201303 1.090 232.773 1.129
201306 0.710 233.504 0.733
201309 0.810 234.149 0.834
201312 0.670 233.049 0.693
201403 0.720 236.293 0.734
201406 0.800 238.343 0.809
201409 0.590 238.031 0.597
201412 1.290 234.812 1.324
201503 0.580 236.119 0.592
201506 0.790 238.638 0.798
201509 0.530 237.945 0.537
201512 0.980 236.525 0.999
201603 0.530 238.132 0.536
201606 -1.560 241.018 -1.560

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.

Starwood Hotels & Resorts Worldwide Inc's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=77.05/2.46
=31.32

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


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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