USD 3.98 as of today(2020-04-04). In depth view into Wells Fargo E10 explanation, calculation, historical data and more" />WFC E10 | Wells Fargo - GuruFocus.com
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Wells Fargo E10

: USD 3.98 (As of Dec. 2019)
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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.

Wells Fargo's adjusted earnings per share data for the three months ended in Dec. 2019 was USD 0.600. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is USD 3.98 for the trailing ten years ended in Dec. 2019.

As of today (2020-04-04), Wells Fargo's current stock price is USD 26.23. Wells Fargo's E10 for the quarter that ended in Dec. 2019 was USD 3.98. Wells Fargo's Shiller PE Ratio of today is 6.59.

During the past 13 years, the highest Shiller PE Ratio of Wells Fargo was 20.19. The lowest was 6.53. And the median was 15.62.


Wells Fargo E10 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.

Wells Fargo Annual Data
Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19
E10 Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.92 3.08 3.29 3.71 3.98

Wells Fargo Quarterly Data
Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19
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 3.71 3.80 3.90 3.93 3.98

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.


Wells Fargo E10 Distribution

* The bar in red indicates where Wells Fargo's E10 falls into.



Wells Fargo E10 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, Wells Fargo's adjusted earnings per share data for the three months ended in Dec. 2019 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Dec. 2019 (Change)*Current CPI (Dec. 2019)
=0.6/257.14*257.14
=0.600

Current CPI (Dec. 2019) = 257.14.

Wells Fargo Quarterly Data

per share eps CPI Adj_EPS
201003 0.450 217.630 0.532
201006 0.550 217.970 0.649
201009 0.600 218.440 0.706
201012 0.610 219.180 0.716
201103 0.670 223.470 0.771
201106 0.700 225.720 0.797
201109 0.720 226.890 0.816
201112 0.730 225.670 0.832
201203 0.750 229.390 0.841
201206 0.820 229.480 0.919
201209 0.880 231.410 0.978
201212 0.910 229.600 1.019
201303 0.920 232.770 1.016
201306 0.980 233.500 1.079
201309 0.990 234.150 1.087
201312 1.000 233.050 1.103
201403 1.050 236.290 1.143
201406 1.010 238.340 1.090
201409 1.020 238.030 1.102
201412 1.020 234.810 1.117
201503 1.040 236.120 1.133
201506 1.030 238.640 1.110
201509 1.050 237.940 1.135
201512 1.030 236.530 1.120
201603 0.990 238.130 1.069
201606 1.010 241.020 1.078
201609 1.030 241.430 1.097
201612 0.960 241.430 1.022
201703 1.030 243.800 1.086
201706 1.080 244.960 1.134
201709 0.830 246.820 0.865
201712 1.160 246.520 1.210
201803 0.960 249.550 0.989
201806 0.980 251.990 1.000
201809 1.130 252.440 1.151
201812 1.210 251.230 1.238
201903 1.200 254.200 1.214
201906 1.300 256.140 1.305
201909 0.920 256.760 0.921
201912 0.600 257.140 0.600

Add all the adjusted EPS together and divide 10 will get our e10.


Wells Fargo  (NYSE:WFC) 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.

Wells Fargo's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=26.23/3.98
=6.59

* 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 Wells Fargo was 20.19. The lowest was 6.53. And the median was 15.62.


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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