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InterDigital Inc  (NAS:IDCC) E10: $3.43 (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.

InterDigital Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was $1.460. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $3.43 for the trailing ten years ended in Jun. 2017.

As of today, InterDigital Inc's current stock price is $75.15. InterDigital Inc's E10 for the quarter that ended in Jun. 2017 was $3.43. InterDigital Inc's Shiller PE Ratio of today is 21.91.

During the past 13 years, the highest Shiller PE Ratio of InterDigital Inc was 72.20. The lowest was 11.97. And the median was 25.49.


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.

InterDigital Inc 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 2.21 2.24 2.47 2.70 3.16

InterDigital Inc 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 2.57 2.82 3.16 3.24 3.43

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, InterDigital Inc'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)
=1.46/244.955*244.955
=1.460

Current CPI (Jun. 2017) = 244.955.

InterDigital Inc Quarterly Data

per share eps CPI Adj_EPS
200709 0.180 208.490 0.211
200712 -0.040 210.036 -0.047
200803 0.150 213.528 0.172
200806 0.130 218.815 0.146
200809 0.200 218.783 0.224
200812 0.090 210.228 0.105
200903 -0.200 212.709 -0.230
200906 0.590 215.693 0.670
200909 0.690 215.969 0.783
200912 0.890 215.949 1.010
201003 1.100 217.631 1.238
201006 0.780 217.965 0.877
201009 0.790 218.439 0.886
201012 0.760 219.179 0.849
201103 0.510 223.467 0.559
201106 0.370 225.722 0.402
201109 0.570 226.889 0.615
201112 0.490 225.672 0.532
201203 0.240 229.392 0.256
201206 0.220 229.478 0.235
201209 5.560 231.407 5.886
201212 0.450 229.601 0.480
201303 -0.300 232.773 -0.316
201306 0.220 233.504 0.231
201309 0.640 234.149 0.670
201312 0.350 233.049 0.368
201403 -0.050 236.293 -0.052
201406 1.930 238.343 1.984
201409 0.340 238.031 0.350
201412 0.390 234.812 0.407
201503 0.780 236.119 0.809
201506 0.890 238.638 0.914
201509 0.680 237.945 0.700
201512 0.920 236.525 0.953
201603 0.790 238.132 0.813
201606 1.140 241.018 1.159
201609 2.990 241.428 3.034
201612 3.860 241.432 3.916
201703 0.930 243.801 0.934
201706 1.460 244.955 1.460

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.

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

Shiller PE Ratio=Share Price/E10
=75.15/3.43
=21.91

* 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 InterDigital Inc was 72.20. The lowest was 11.97. And the median was 25.49.


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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