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Tata Motors Ltd  (NYSE:TTM) E10: $2.03 (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.

Tata Motors Ltd's adjusted earnings per share data for the three months ended in Sep. 2017 was $0.565. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $2.03 for the trailing ten years ended in Sep. 2017.

As of today, Tata Motors Ltd's current stock price is $32.88. Tata Motors Ltd's E10 for the quarter that ended in Sep. 2017 was $2.03. Tata Motors Ltd's Shiller PE Ratio of today is 16.20.

During the past 13 years, the highest Shiller PE Ratio of Tata Motors Ltd was 23.86. The lowest was 13.48. 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.

Tata Motors Ltd Annual Data

Mar08 Mar09 Mar10 Mar11 Mar12 Mar13 Mar14 Mar15 Mar16 Mar17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 0.00 0.00 0.00 1.75 1.88

Tata Motors Ltd 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 1.79 1.73 1.88 1.93 2.03

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, Tata Motors Ltd'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)
=0.565313481447/246.819*246.819
=0.565

Current CPI (Sep. 2017) = 246.819.

Tata Motors Ltd Quarterly Data

per share eps CPI Adj_EPS
200603 0.179 199.800 0.222
200606 0.237 202.900 0.289
200609 0.236 202.900 0.287
200612 0.245 201.800 0.300
200703 0.240 205.352 0.289
200706 0.219 208.352 0.260
200709 0.220 208.490 0.261
200712 0.225 210.036 0.264
200803 0.577 213.528 0.667
200903 -3.161 212.709 -3.668
200912 0.234 215.949 0.267
201003 1.426 217.631 1.617
201006 0.683 217.965 0.774
201009 0.773 218.439 0.873
201012 0.806 219.179 0.908
201103 2.933 223.467 3.240
201112 0.976 225.672 1.068
201203 1.264 229.392 1.360
201206 0.631 229.478 0.679
201209 0.588 231.407 0.627
201212 0.459 229.601 0.493
201303 1.124 232.773 1.192
201306 0.456 233.504 0.482
201309 0.854 234.149 0.900
201312 1.193 233.049 1.264
201403 0.987 236.293 1.031
201406 1.388 238.343 1.437
201409 0.829 238.031 0.860
201412 0.624 234.812 0.656
201503 0.421 236.119 0.440
201506 0.653 238.638 0.675
201509 -0.392 237.945 -0.407
201512 0.775 236.525 0.809
201603 0.829 238.132 0.859
201606 0.488 241.018 0.500
201609 0.181 241.428 0.185
201612 0.019 241.432 0.020
201703 0.662 243.801 0.670
201706 0.725 244.955 0.731
201709 0.565 246.819 0.565

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.

Tata Motors Ltd's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=32.88/2.03
=16.20

* 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 Tata Motors Ltd was 23.86. The lowest was 13.48. 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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