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Westinghouse Air Brake Technologies Corp  (NYSE:WAB) E10: $2.58 (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.

Westinghouse Air Brake Technologies Corp's adjusted earnings per share data for the three months ended in Jun. 2017 was $0.750. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $2.58 for the trailing ten years ended in Jun. 2017.

As of today, Westinghouse Air Brake Technologies Corp's current stock price is $76.87. Westinghouse Air Brake Technologies Corp's E10 for the quarter that ended in Jun. 2017 was $2.58. Westinghouse Air Brake Technologies Corp's Shiller PE Ratio of today is 29.79.

During the past 13 years, the highest Shiller PE Ratio of Westinghouse Air Brake Technologies Corp was 53.27. The lowest was 18.23. And the median was 34.81.


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.

Westinghouse Air Brake Technologies Corp 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 1.21 1.49 1.81 2.17 2.44

Westinghouse Air Brake Technologies Corp Quarterly Data

Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17
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 2.36 2.43 2.44 2.51 2.58

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, Westinghouse Air Brake Technologies Corp'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)
=0.75/244.955*244.955
=0.750

Current CPI (Jun. 2017) = 244.955.

Westinghouse Air Brake Technologies Corp Quarterly Data

per share eps CPI Adj_EPS
200709 0.275 208.490 0.323
200712 0.290 210.036 0.338
200803 0.330 213.528 0.379
200806 0.345 218.815 0.386
200809 0.340 218.783 0.381
200812 0.315 210.228 0.367
200903 0.340 212.709 0.392
200906 0.320 215.693 0.363
200909 0.285 215.969 0.323
200912 0.250 215.949 0.284
201003 0.315 217.631 0.355
201006 0.325 217.965 0.365
201009 0.315 218.439 0.353
201012 0.320 219.179 0.358
201103 0.425 223.467 0.466
201106 0.375 225.722 0.407
201109 0.480 226.889 0.518
201112 0.480 225.672 0.521
201203 0.610 229.392 0.651
201206 0.670 229.478 0.715
201209 0.650 231.407 0.688
201212 0.670 229.601 0.715
201303 0.720 232.773 0.758
201306 0.770 233.504 0.808
201309 0.760 234.149 0.795
201312 0.760 233.049 0.799
201403 0.830 236.293 0.860
201406 0.910 238.343 0.935
201409 0.930 238.031 0.957
201412 0.950 234.812 0.991
201503 0.990 236.119 1.027
201506 1.040 238.638 1.068
201509 1.020 237.945 1.050
201512 1.050 236.525 1.087
201603 1.020 238.132 1.049
201606 1.000 241.018 1.016
201609 0.910 241.428 0.923
201612 0.420 241.432 0.426
201703 0.770 243.801 0.774
201706 0.750 244.955 0.750

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.

Westinghouse Air Brake Technologies Corp's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=76.87/2.58
=29.79

* 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 Westinghouse Air Brake Technologies Corp was 53.27. The lowest was 18.23. And the median was 34.81.


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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