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The Western Union Co  (NYSE:WU) E10: $1.49 (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.

The Western Union Co's adjusted earnings per share data for the three months ended in Jun. 2017 was $0.350. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $1.49 for the trailing ten years ended in Jun. 2017.

As of today, The Western Union Co's current stock price is $20.20. The Western Union Co's E10 for the quarter that ended in Jun. 2017 was $1.49. The Western Union Co's Shiller PE Ratio of today is 13.56.

During the past 13 years, the highest Shiller PE Ratio of The Western Union Co was 15.57. The lowest was 9.01. And the median was 12.14.


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.

The Western Union Co 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 0.00 1.59 1.60 1.51 1.45

The Western Union Co 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 1.55 1.56 1.45 1.47 1.49

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, The Western Union Co'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)
=0.35/244.955*244.955
=0.350

Current CPI (Jun. 2017) = 244.955.

The Western Union Co Quarterly Data

per share eps CPI Adj_EPS
200709 0.280 208.490 0.329
200712 0.320 210.036 0.373
200803 0.270 213.528 0.310
200806 0.310 218.815 0.347
200809 0.330 218.783 0.369
200812 0.330 210.228 0.385
200903 0.320 212.709 0.369
200906 0.310 215.693 0.352
200909 0.260 215.969 0.295
200912 0.320 215.949 0.363
201003 0.300 217.631 0.338
201006 0.330 217.965 0.371
201009 0.360 218.439 0.404
201012 0.370 219.179 0.414
201103 0.320 223.467 0.351
201106 0.410 225.722 0.445
201109 0.380 226.889 0.410
201112 0.720 225.672 0.782
201203 0.400 229.392 0.427
201206 0.440 229.478 0.470
201209 0.450 231.407 0.476
201212 0.400 229.601 0.427
201303 0.370 232.773 0.389
201306 0.360 233.504 0.378
201309 0.390 234.149 0.408
201312 0.310 233.049 0.326
201403 0.370 236.293 0.384
201406 0.360 238.343 0.370
201409 0.440 238.031 0.453
201412 0.420 234.812 0.438
201503 0.390 236.119 0.405
201506 0.360 238.638 0.370
201509 0.450 237.945 0.463
201512 0.420 236.525 0.435
201603 0.370 238.132 0.381
201606 0.420 241.018 0.427
201609 0.440 241.428 0.446
201612 -0.720 241.432 -0.731
201703 0.330 243.801 0.332
201706 0.350 244.955 0.350

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.

The Western Union Co's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=20.20/1.49
=13.56

* 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 The Western Union Co was 15.57. The lowest was 9.01. And the median was 12.14.


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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