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Royal Dutch Shell PLC  (NYSE:RDS.A) E10: $4.93 (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.

Royal Dutch Shell PLC's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.980. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $4.93 for the trailing ten years ended in Sep. 2017.

As of today, Royal Dutch Shell PLC's current stock price is $61.90. Royal Dutch Shell PLC's E10 for the quarter that ended in Sep. 2017 was $4.93. Royal Dutch Shell PLC's Shiller PE Ratio of today is 12.56.

During the past 13 years, the highest Shiller PE Ratio of Royal Dutch Shell PLC was 13.31. The lowest was 5.00. And the median was 8.58.


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.

Royal Dutch Shell PLC 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 0.00 13.02 7.21 6.21 4.61

Royal Dutch Shell PLC 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 5.08 4.61 4.73 4.81 4.93

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, Royal Dutch Shell PLC'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)
=0.98/246.819*246.819
=0.980

Current CPI (Sep. 2017) = 246.819.

Royal Dutch Shell PLC Quarterly Data

per share eps CPI Adj_EPS
200712 2.720 210.036 3.196
200803 2.920 213.528 3.375
200806 3.740 218.815 4.219
200809 2.740 218.783 3.091
200812 -0.880 210.228 -1.033
200903 1.140 212.709 1.323
200906 1.240 215.693 1.419
200909 1.060 215.969 1.211
200912 0.640 215.949 0.731
201003 1.780 217.631 2.019
201006 1.440 217.965 1.631
201009 1.120 218.439 1.266
201012 2.200 219.179 2.477
201103 2.840 223.467 3.137
201106 2.780 225.722 3.040
201109 2.240 226.889 2.437
201112 2.080 225.672 2.275
201203 2.800 229.392 3.013
201206 1.320 229.478 1.420
201209 2.280 231.407 2.432
201212 2.140 229.601 2.300
201303 2.580 232.773 2.736
201306 0.540 233.504 0.571
201309 1.500 234.149 1.581
201312 0.560 233.049 0.593
201403 1.440 236.293 1.504
201406 1.680 238.343 1.740
201409 1.400 238.031 1.452
201412 0.180 234.812 0.189
201503 1.380 236.119 1.443
201506 1.240 238.638 1.283
201509 -2.340 237.945 -2.427
201512 0.300 236.525 0.313
201603 0.140 238.132 0.145
201606 0.300 241.018 0.307
201609 0.340 241.428 0.348
201612 0.380 241.432 0.388
201703 0.860 243.801 0.871
201706 0.380 244.955 0.383
201709 0.980 246.819 0.980

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.

Royal Dutch Shell PLC's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=61.90/4.93
=12.56

* 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 Royal Dutch Shell PLC was 13.31. The lowest was 5.00. And the median was 8.58.


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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