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Morningstar E10

: $3.07 (As of Jun. 2020)
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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.

Morningstar's adjusted earnings per share data for the three months ended in Jun. 2020 was $1.120. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $3.07 for the trailing ten years ended in Jun. 2020.

As of today (2020-08-05), Morningstar's current stock price is $162.88. Morningstar's E10 for the quarter that ended in Jun. 2020 was $3.07. Morningstar's Shiller PE Ratio of today is 53.06.

During the past 13 years, the highest Shiller PE Ratio of Morningstar was 86.04. The lowest was 30.05. And the median was 41.23.


Morningstar E10 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.

Morningstar Annual Data
Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.06 2.35 2.54 2.79 3.01

Morningstar Quarterly Data
Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20
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 2.90 2.97 3.01 3.00 3.07

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.


Morningstar E10 Distribution

* The bar in red indicates where Morningstar's E10 falls into.



Morningstar E10 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.

Please note that we use the CPI data of the country/region where the company is headquartered. If the CPI data for that country/region is not available, then we will use the CPI data of the United States as default.

For example, Morningstar's adjusted earnings per share data for the three months ended in Jun. 2020 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Jun. 2020 (Change)*Current CPI (Jun. 2020)
=1.12/108.1754*108.1754
=1.120

Current CPI (Jun. 2020) = 108.1754.

Morningstar Quarterly Data

per share eps CPI Adj_EPS
201009 0.490 92.277 0.574
201012 0.540 92.914 0.629
201103 0.440 94.890 0.502
201106 0.520 95.319 0.590
201109 0.420 95.529 0.476
201112 0.550 95.632 0.622
201203 0.400 97.075 0.446
201206 0.560 96.661 0.627
201209 0.560 97.595 0.621
201212 0.690 97.158 0.768
201303 0.630 98.107 0.695
201306 0.660 98.557 0.724
201309 0.680 98.536 0.747
201312 0.680 98.692 0.745
201403 0.580 100.023 0.627
201406 -0.220 100.520 -0.237
201409 0.670 100.176 0.724
201412 0.710 98.604 0.779
201503 0.670 99.824 0.726
201506 0.720 100.691 0.774
201509 0.760 100.346 0.819
201512 0.850 99.957 0.920
201603 0.670 100.947 0.718
201606 0.730 101.524 0.778
201609 0.700 101.988 0.742
201612 1.630 102.456 1.721
201703 0.420 103.167 0.440
201706 1.070 103.278 1.121
201709 0.790 104.070 0.821
201712 0.910 104.578 0.941
201803 0.980 105.708 1.003
201806 0.970 106.324 0.987
201809 1.320 106.695 1.338
201812 0.990 106.200 1.008
201903 0.770 107.818 0.773
201906 0.980 108.250 0.979
201909 1.140 108.577 1.136
201912 0.640 108.841 0.636
202003 0.550 108.173 0.550
202006 1.120 108.175 1.120

Add all the adjusted EPS together and divide 10 will get our e10.


Morningstar  (NAS:MORN) 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.

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

Shiller PE Ratio=Share Price/E10
=162.88/3.07
=53.06

* 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 Morningstar was 86.04. The lowest was 30.05. And the median was 41.23.


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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