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Illumina Inc  (NAS:ILMN) E10: $1.71 (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.

Illumina Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was $0.870. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.71 for the trailing ten years ended in Jun. 2017.

As of today, Illumina Inc's current stock price is $209.88. Illumina Inc's E10 for the quarter that ended in Jun. 2017 was $1.71. Illumina Inc's Shiller PE Ratio of today is 122.74.

During the past 13 years, the highest Shiller PE Ratio of Illumina Inc was 3600.00. The lowest was 99.02. And the median was 376.42.


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.

Illumina 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 0.02 0.16 0.40 0.75 1.03

Illumina 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 0.90 0.97 1.03 1.62 1.71

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, Illumina 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)
=0.87/244.955*244.955
=0.870

Current CPI (Jun. 2017) = 244.955.

Illumina Inc Quarterly Data

per share eps CPI Adj_EPS
200709 0.120 208.490 0.141
200712 -0.020 210.036 -0.023
200803 0.105 213.528 0.120
200806 0.115 218.815 0.129
200809 -0.060 218.783 -0.067
200812 0.140 210.228 0.163
200903 0.140 212.709 0.161
200906 0.180 215.693 0.204
200909 0.120 215.969 0.136
200912 0.090 215.949 0.102
201003 0.160 217.631 0.180
201006 0.210 217.965 0.236
201009 0.240 218.439 0.269
201012 0.260 219.179 0.291
201103 0.160 223.467 0.175
201106 0.220 225.722 0.239
201109 0.150 226.889 0.162
201112 0.100 225.672 0.109
201203 0.200 229.392 0.214
201206 0.180 229.478 0.192
201209 0.220 231.407 0.233
201212 0.530 229.601 0.565
201303 -0.180 232.773 -0.189
201306 0.260 233.504 0.273
201309 0.220 234.149 0.230
201312 0.580 233.049 0.610
201403 0.400 236.293 0.415
201406 0.310 238.343 0.319
201409 0.630 238.031 0.648
201412 1.030 234.812 1.074
201503 0.920 236.119 0.954
201506 0.690 238.638 0.708
201509 0.790 237.945 0.813
201512 0.710 236.525 0.735
201603 0.600 238.132 0.617
201606 0.820 241.018 0.833
201609 0.870 241.428 0.883
201612 0.800 241.432 0.812
201703 2.480 243.801 2.492
201706 0.870 244.955 0.870

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.

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

Shiller PE Ratio=Share Price/E10
=209.88/1.71
=122.74

* 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 Illumina Inc was 3600.00. The lowest was 99.02. And the median was 376.42.


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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