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Radian Group Inc  (NYSE:RDN) E10: \$-4.32 (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.

Radian Group Inc's adjusted earnings per share data for the three months ended in Jun. 2017 was \$-0.130. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is \$-4.32 for the trailing ten years ended in Jun. 2017.

As of today, Radian Group Inc's current stock price is \$20.47. Radian Group Inc's E10 for the quarter that ended in Jun. 2017 was \$-4.32. Radian Group Inc's Shiller PE Ratio of today is .

During the past 13 years, the highest Shiller PE Ratio of Radian Group Inc was 20.73. The lowest was 0.00. And the median was 4.24.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 E10 -1.75 -2.40 -2.67 -3.29 -4.06

 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 E10 -3.73 -3.85 -4.06 -4.23 -4.32

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, Radian Group 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) = -0.13 / 244.955 * 244.955 = -0.130

Current CPI (Jun. 2017) = 244.955.

 per share eps CPI Adj_EPS 200709 -8.820 208.490 -10.363 200712 -9.060 210.036 -10.566 200803 2.440 213.528 2.799 200806 -4.910 218.815 -5.497 200809 0.460 218.783 0.515 200812 -3.110 210.228 -3.624 200903 -2.690 212.709 -3.098 200906 2.820 215.693 3.203 200909 -0.860 215.969 -0.975 200912 -1.110 215.949 -1.259 201003 -3.770 217.631 -4.243 201006 -4.310 217.965 -4.844 201009 0.840 218.439 0.942 201012 -9.540 219.179 -10.662 201103 0.770 223.467 0.844 201106 1.030 225.722 1.118 201109 1.370 226.889 1.479 201112 -0.920 225.672 -0.999 201203 -1.280 229.392 -1.367 201206 -0.900 229.478 -0.961 201209 0.110 231.407 0.116 201212 -1.340 229.601 -1.430 201303 -1.300 232.773 -1.368 201306 -0.190 233.504 -0.199 201309 -0.070 234.149 -0.073 201312 0.250 233.049 0.263 201403 0.940 236.293 0.974 201406 0.780 238.343 0.802 201409 0.670 238.031 0.689 201412 1.790 234.812 1.867 201503 0.390 236.119 0.405 201506 0.220 238.638 0.226 201509 0.290 237.945 0.299 201512 0.320 236.525 0.331 201603 0.290 238.132 0.298 201606 0.440 241.018 0.447 201609 0.370 241.428 0.375 201612 0.280 241.432 0.284 201703 0.340 243.801 0.342 201706 -0.130 244.955 -0.130

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.

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

 Shiller PE Ratio = Share Price / E10 = 20.47 / -4.32 =

* 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 Radian Group Inc was 20.73. The lowest was 0.00. And the median was 4.24.

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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