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Target Corp  (NYSE:TGT) E10: $4.04 (As of Jan. 2019)

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.

Target Corp's adjusted earnings per share data for the three months ended in Jan. 2019 was $1.520. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $4.04 for the trailing ten years ended in Jan. 2019.

As of today, Target Corp's current stock price is $70.89. Target Corp's E10 for the quarter that ended in Jan. 2019 was $4.04. Target Corp's Shiller PE Ratio of today is 17.55.

During the past 13 years, the highest Shiller PE Ratio of Target Corp was 26.44. The lowest was 10.14. And the median was 17.74.


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.

Target Corp Annual Data

Jan10 Jan11 Jan12 Jan13 Jan14 Jan15 Jan16 Jan17 Jan18 Jan19
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.12 3.35 3.54 3.75 4.04

Target Corp Quarterly Data

Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19
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 3.75 3.83 3.93 3.99 4.04

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.


Target Corp Distribution

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



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, Target Corp's adjusted earnings per share data for the three months ended in Jan. 2019 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Jan. 2019 (Change)*Current CPI (Jan. 2019)
=1.52/251.712*251.712
=1.520

Current CPI (Jan. 2019) = 251.712.

Target Corp Quarterly Data

per share eps CPI Adj_EPS
200904 0.690 213.240 0.814
200907 0.790 215.351 0.923
200910 0.580 216.177 0.675
201001 1.240 216.687 1.440
201004 0.900 218.009 1.039
201007 0.920 218.011 1.062
201010 0.740 218.711 0.852
201101 1.430 220.223 1.634
201104 0.990 224.906 1.108
201107 1.030 225.922 1.148
201110 0.820 226.421 0.912
201201 1.440 226.665 1.599
201204 1.040 230.085 1.138
201207 1.060 229.104 1.165
201210 0.960 231.317 1.045
201301 1.470 230.280 1.607
201304 0.770 232.531 0.834
201307 0.950 233.596 1.024
201310 0.540 233.546 0.582
201401 0.810 233.916 0.872
201404 0.660 237.072 0.701
201407 0.370 238.250 0.391
201410 0.550 237.433 0.583
201501 -4.140 233.707 -4.459
201504 0.980 236.599 1.043
201507 1.180 238.654 1.245
201510 0.870 237.838 0.921
201601 2.320 236.916 2.465
201604 1.050 239.261 1.105
201607 1.160 240.628 1.213
201610 1.060 241.729 1.104
201701 1.450 242.839 1.503
201704 1.220 244.524 1.256
201707 1.220 244.786 1.255
201710 0.870 246.663 0.888
201801 2.020 247.867 2.051
201804 1.330 250.546 1.336
201807 1.490 252.006 1.488
201810 1.170 252.885 1.165
201901 1.520 251.712 1.520

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.

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

Shiller PE Ratio=Share Price/E10
=70.89/4.04
=17.55

* 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 Target Corp was 26.44. The lowest was 10.14. And the median was 17.74.


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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