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H&R Block Inc  (NYSE:HRB) E10: $1.47 (As of Oct. 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.

H&R Block Inc's adjusted earnings per share data for the three months ended in Oct. 2017 was $-0.740. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.47 for the trailing ten years ended in Oct. 2017.

As of today, H&R Block Inc's current stock price is $27.62. H&R Block Inc's E10 for the quarter that ended in Oct. 2017 was $1.47. H&R Block Inc's Shiller PE Ratio of today is 18.79.

During the past 13 years, the highest Shiller PE Ratio of H&R Block Inc was 41.40. The lowest was 11.00. And the median was 23.21.


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.

H&R Block Inc Annual Data

Apr08 Apr09 Apr10 Apr11 Apr12 Apr13 Apr14 Apr15 Apr16 Apr17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.06 1.00 0.95 0.93 1.30

H&R Block Inc Quarterly Data

Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17
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 0.92 0.91 1.30 1.35 1.47

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, H&R Block Inc's adjusted earnings per share data for the three months ended in Oct. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Oct. 2017 (Change)*Current CPI (Oct. 2017)
=-0.74/246.663*246.663
=-0.740

Current CPI (Oct. 2017) = 246.663.

H&R Block Inc Quarterly Data

per share eps CPI Adj_EPS
200801 -0.150 211.080 -0.175
200804 1.680 214.823 1.929
200807 -0.410 219.964 -0.460
200810 -0.410 216.573 -0.467
200901 0.140 211.143 0.164
200904 2.120 213.240 2.452
200907 -0.400 215.351 -0.458
200910 -0.380 216.177 -0.434
201001 0.150 216.687 0.171
201004 2.060 218.009 2.331
201007 -0.410 218.011 -0.464
201010 -0.360 218.711 -0.406
201101 -0.042 220.223 -0.047
201104 2.120 224.906 2.325
201107 -0.573 225.922 -0.626
201110 -0.473 226.421 -0.515
201201 -0.011 226.665 -0.012
201204 1.960 230.085 2.101
201207 -0.390 229.104 -0.420
201210 -0.390 231.317 -0.416
201301 -0.070 230.280 -0.075
201304 2.423 232.531 2.570
201307 -0.420 233.596 -0.443
201310 -0.390 233.546 -0.412
201401 -0.783 233.916 -0.826
201404 3.310 237.072 3.444
201407 -0.420 238.250 -0.435
201410 -0.410 237.433 -0.426
201501 -0.130 233.707 -0.137
201504 2.680 236.599 2.794
201507 -0.360 238.654 -0.372
201510 -0.550 237.838 -0.570
201601 -0.352 236.916 -0.366
201604 2.760 239.261 2.845
201607 -0.560 240.628 -0.574
201610 -0.680 241.729 -0.694
201701 -0.503 242.839 -0.511
201704 3.660 244.524 3.692
201707 -0.630 244.786 -0.635
201710 -0.740 246.663 -0.740

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.

H&R Block Inc's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=27.62/1.47
=18.79

* 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 H&R Block Inc was 41.40. The lowest was 11.00. And the median was 23.21.


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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