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Western Digital Corp  (NAS:WDC) E10: $4.39 (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.

Western Digital Corp's adjusted earnings per share data for the three months ended in Jun. 2017 was $0.940. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $4.39 for the trailing ten years ended in Jun. 2017.

As of today, Western Digital Corp's current stock price is $87.99. Western Digital Corp's E10 for the quarter that ended in Jun. 2017 was $4.39. Western Digital Corp's Shiller PE Ratio of today is 20.04.

During the past 13 years, the highest Shiller PE Ratio of Western Digital Corp was 1946.50. The lowest was 7.62. And the median was 18.20.


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.

Western Digital Corp Annual Data

Jun08 Jun09 Jun10 Jun11 Jun12 Jun13 Jun14 Jun15 Jun16 Jun17
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.37 4.03 4.54 4.47 4.39

Western Digital 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 4.47 4.29 4.30 4.36 4.39

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, Western Digital 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)
=0.94/244.955*244.955
=0.940

Current CPI (Jun. 2017) = 244.955.

Western Digital Corp Quarterly Data

per share eps CPI Adj_EPS
200709 0.310 208.490 0.364
200712 1.350 210.036 1.574
200803 1.230 213.528 1.411
200806 0.950 218.815 1.063
200809 0.930 218.783 1.041
200812 0.060 210.228 0.070
200903 0.220 212.709 0.253
200906 0.860 215.693 0.977
200909 1.250 215.969 1.418
200912 1.850 215.949 2.098
201003 1.710 217.631 1.925
201006 1.110 217.965 1.247
201009 0.840 218.439 0.942
201012 0.960 219.179 1.073
201103 0.620 223.467 0.680
201106 0.670 225.722 0.727
201109 1.010 226.889 1.090
201112 0.610 225.672 0.662
201203 1.960 229.392 2.093
201206 2.970 229.478 3.170
201209 2.060 231.407 2.181
201212 1.360 229.601 1.451
201303 1.600 232.773 1.684
201306 -1.070 233.504 -1.122
201309 2.050 234.149 2.145
201312 1.770 233.049 1.860
201403 1.550 236.293 1.607
201406 1.310 238.343 1.346
201409 1.760 238.031 1.811
201412 1.840 234.812 1.919
201503 1.630 236.119 1.691
201506 0.950 238.638 0.975
201509 1.210 237.945 1.246
201512 1.070 236.525 1.108
201603 0.320 238.132 0.329
201606 -1.610 241.018 -1.636
201609 -1.280 241.428 -1.299
201612 0.800 241.432 0.812
201703 0.830 243.801 0.834
201706 0.940 244.955 0.940

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.

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

Shiller PE Ratio=Share Price/E10
=87.99/4.39
=20.04

* 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 Western Digital Corp was 1946.50. The lowest was 7.62. And the median was 18.20.


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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