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Invesco Ltd  (NYSE:IVZ) E10: $1.81 (As of Sep. 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.

Invesco Ltd's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.650. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.81 for the trailing ten years ended in Sep. 2017.

As of today, Invesco Ltd's current stock price is $35.23. Invesco Ltd's E10 for the quarter that ended in Sep. 2017 was $1.81. Invesco Ltd's Shiller PE Ratio of today is 19.46.

During the past 13 years, the highest Shiller PE Ratio of Invesco Ltd was 54.24. The lowest was 13.23. And the median was 26.31.


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.

Invesco Ltd 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 1.06 1.22 1.47 1.65 1.72

Invesco Ltd Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
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 1.76 1.72 1.75 1.77 1.81

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, Invesco Ltd's adjusted earnings per share data for the three months ended in Sep. 2017 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Sep. 2017 (Change)*Current CPI (Sep. 2017)
=0.65/246.819*246.819
=0.650

Current CPI (Sep. 2017) = 246.819.

Invesco Ltd Quarterly Data

per share eps CPI Adj_EPS
200712 0.430 210.036 0.505
200803 0.390 213.528 0.451
200806 0.410 218.815 0.462
200809 0.330 218.783 0.372
200812 0.090 210.228 0.106
200903 0.080 212.709 0.093
200906 0.180 215.693 0.206
200909 0.240 215.969 0.274
200912 0.250 215.949 0.286
201003 0.210 217.631 0.238
201006 0.090 217.965 0.102
201009 0.320 218.439 0.362
201012 0.370 219.179 0.417
201103 0.380 223.467 0.420
201106 0.390 225.722 0.426
201109 0.360 226.889 0.392
201112 0.440 225.672 0.481
201203 0.430 229.392 0.463
201206 0.340 229.478 0.366
201209 0.380 231.407 0.405
201212 0.350 229.601 0.376
201303 0.490 232.773 0.520
201306 0.450 233.504 0.476
201309 0.510 234.149 0.538
201312 0.640 233.049 0.678
201403 0.430 236.293 0.449
201406 0.630 238.343 0.652
201409 0.590 238.031 0.612
201412 0.620 234.812 0.652
201503 0.600 236.119 0.627
201506 0.600 238.638 0.621
201509 0.580 237.945 0.602
201512 0.480 236.525 0.501
201603 0.380 238.132 0.394
201606 0.540 241.018 0.553
201609 0.580 241.428 0.593
201612 0.550 241.432 0.562
201703 0.520 243.801 0.526
201706 0.580 244.955 0.584
201709 0.650 246.819 0.650

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.

Invesco Ltd's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=35.23/1.81
=19.46

* 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 Invesco Ltd was 54.24. The lowest was 13.23. And the median was 26.31.


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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