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Meritage Homes Corp  (NYSE:MTH) E10: $-0.02 (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.

Meritage Homes Corp's adjusted earnings per share data for the three months ended in Sep. 2017 was $1.020. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $-0.02 for the trailing ten years ended in Sep. 2017.

As of today, Meritage Homes Corp's current stock price is $52.45. Meritage Homes Corp's E10 for the quarter that ended in Sep. 2017 was $-0.02. Meritage Homes Corp's Shiller PE Ratio of today is .

During the past 13 years, the highest Shiller PE Ratio of Meritage Homes Corp was 270.11. The lowest was 0.00. And the median was 20.60.


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.

Meritage Homes Corp 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 0.81 0.71 0.42 -0.34 -0.98

Meritage Homes Corp 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 -1.06 -0.98 -1.00 -0.65 -0.02

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, Meritage Homes Corp'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)
=1.02/246.819*246.819
=1.020

Current CPI (Sep. 2017) = 246.819.

Meritage Homes Corp Quarterly Data

per share eps CPI Adj_EPS
200712 -4.910 210.036 -5.770
200803 -1.720 213.528 -1.988
200806 -0.790 218.815 -0.891
200809 -4.690 218.783 -5.291
200812 -2.580 210.228 -3.029
200903 -0.600 212.709 -0.696
200906 -2.370 215.693 -2.712
200909 -0.560 215.969 -0.640
200912 1.400 215.949 1.600
201003 0.080 217.631 0.091
201006 0.130 217.965 0.147
201009 0.040 218.439 0.045
201012 -0.030 219.179 -0.034
201103 -0.210 223.467 -0.232
201106 0.020 225.722 0.022
201109 -0.100 226.889 -0.109
201112 -0.360 225.672 -0.394
201203 -0.150 229.392 -0.161
201206 0.240 229.478 0.258
201209 0.190 231.407 0.203
201212 2.700 229.601 2.902
201303 0.320 232.773 0.339
201306 0.740 233.504 0.782
201309 0.990 234.149 1.044
201312 1.200 233.049 1.271
201403 0.620 236.293 0.648
201406 0.850 238.343 0.880
201409 0.790 238.031 0.819
201412 1.190 234.812 1.251
201503 0.400 236.119 0.418
201506 0.700 238.638 0.724
201509 0.730 237.945 0.757
201512 1.260 236.525 1.315
201603 0.500 238.132 0.518
201606 0.950 241.018 0.973
201609 0.880 241.428 0.900
201612 1.220 241.432 1.247
201703 0.560 243.801 0.567
201706 0.980 244.955 0.987
201709 1.020 246.819 1.020

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.

Meritage Homes Corp's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=52.45/-0.02
=

* 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 Meritage Homes Corp was 270.11. The lowest was 0.00. And the median was 20.60.


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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