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HP Inc  (NYSE:HPQ) E10: $1.99 (As of Jul. 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.

HP Inc's adjusted earnings per share data for the three months ended in Jul. 2017 was $0.410. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.99 for the trailing ten years ended in Jul. 2017.

As of today, HP Inc's current stock price is $22.02. HP Inc's E10 for the quarter that ended in Jul. 2017 was $1.99. HP Inc's Shiller PE Ratio of today is 11.07.

During the past 13 years, the highest Shiller PE Ratio of HP Inc was 16.66. The lowest was 3.36. And the median was 8.41.


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.

HP Inc Annual Data

Oct07 Oct08 Oct09 Oct10 Oct11 Oct12 Oct13 Oct14 Oct15 Oct16
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.68 1.85 1.98 2.15 2.06

HP Inc Quarterly Data

Oct12 Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17
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 2.10 2.06 2.05 2.02 1.99

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, HP Inc's adjusted earnings per share data for the three months ended in Jul. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Jul. 2017 (Change)*Current CPI (Jul. 2017)
=0.41/244.786*244.786
=0.410

Current CPI (Jul. 2017) = 244.786.

HP Inc Quarterly Data

per share eps CPI Adj_EPS
200710 0.810 208.936 0.949
200801 0.800 211.080 0.928
200804 0.800 214.823 0.912
200807 0.800 219.964 0.890
200810 0.840 216.573 0.949
200901 0.750 211.143 0.870
200904 0.710 213.240 0.815
200907 0.690 215.351 0.784
200910 0.990 216.177 1.121
201001 0.930 216.687 1.051
201004 0.910 218.009 1.022
201007 0.750 218.011 0.842
201010 1.090 218.711 1.220
201101 1.170 220.223 1.300
201104 1.050 224.906 1.143
201107 0.930 225.922 1.008
201110 0.160 226.421 0.173
201201 0.730 226.665 0.788
201204 0.800 230.085 0.851
201207 -4.490 229.104 -4.797
201210 -3.480 231.317 -3.683
201301 0.630 230.280 0.670
201304 0.550 232.531 0.579
201307 0.710 233.596 0.744
201310 0.730 233.546 0.765
201401 0.740 233.916 0.774
201404 0.660 237.072 0.681
201407 0.520 238.250 0.534
201410 0.690 237.433 0.711
201501 0.730 233.707 0.765
201504 0.550 236.599 0.569
201507 0.470 238.654 0.482
201510 0.730 237.838 0.751
201601 0.330 236.916 0.341
201604 0.360 239.261 0.368
201607 0.450 240.628 0.458
201610 0.280 241.729 0.284
201701 0.360 242.839 0.363
201704 0.330 244.524 0.330
201707 0.410 244.786 0.410

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.

HP Inc's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=22.02/1.99
=11.07

* 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 HP Inc was 16.66. The lowest was 3.36. And the median was 8.41.


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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