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Illinois Tool Works E10

: $6.03 (As of Mar. 2020)
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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.

Illinois Tool Works's adjusted earnings per share data for the three months ended in Mar. 2020 was $1.770. Add all the adjusted EPS for the past 10 years together and divide 10 will get our e10, which is $6.03 for the trailing ten years ended in Mar. 2020.

As of today (2020-07-14), Illinois Tool Works's current stock price is $176.96. Illinois Tool Works's E10 for the quarter that ended in Mar. 2020 was $6.03. Illinois Tool Works's Shiller PE Ratio of today is 29.35.

During the past 13 years, the highest Shiller PE Ratio of Illinois Tool Works was 37.42. The lowest was 16.31. And the median was 23.84.


Illinois Tool Works 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.

Illinois Tool Works 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 4.24 4.60 4.78 5.28 5.96

Illinois Tool Works Quarterly Data
Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20
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 5.55 5.72 5.87 5.96 6.03

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.


Illinois Tool Works E10 Distribution

* The bar in red indicates where Illinois Tool Works's E10 falls into.



Illinois Tool Works 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.

Please note that we use the CPI data of the country/region where the company is headquartered. If the CPI data for that country/region is not available, then we will use the CPI data of the United States as default.

For example, Illinois Tool Works's adjusted earnings per share data for the three months ended in Mar. 2020 was:

Adj_EPS= Earnings per Share (Diluted) /CPI of Mar. 2020 (Change)*Current CPI (Mar. 2020)
=1.77/108.1733*108.1733
=1.770

Current CPI (Mar. 2020) = 108.1733.

Illinois Tool Works Quarterly Data

per share eps CPI Adj_EPS
201006 0.810 91.981 0.953
201009 0.840 92.277 0.985
201012 0.790 92.914 0.920
201103 1.240 94.890 1.414
201106 0.990 95.319 1.124
201109 1.040 95.529 1.178
201112 0.910 95.632 1.029
201203 1.000 97.075 1.114
201206 1.850 96.661 2.070
201209 1.120 97.595 1.241
201212 2.110 97.158 2.349
201303 0.780 98.107 0.860
201306 1.030 98.557 1.131
201309 1.010 98.536 1.109
201312 0.930 98.692 1.019
201403 1.110 100.023 1.200
201406 3.660 100.520 3.939
201409 1.340 100.176 1.447
201412 1.160 98.604 1.273
201503 1.210 99.824 1.311
201506 1.300 100.691 1.397
201509 1.390 100.346 1.498
201512 1.230 99.957 1.331
201603 1.290 100.947 1.382
201606 1.460 101.524 1.556
201609 1.500 101.988 1.591
201612 1.450 102.456 1.531
201703 1.540 103.167 1.615
201706 1.690 103.278 1.770
201709 1.850 104.070 1.923
201712 -0.220 104.578 -0.228
201803 1.900 105.708 1.944
201806 1.970 106.324 2.004
201809 1.900 106.695 1.926
201812 1.830 106.200 1.864
201903 1.810 107.818 1.816
201906 1.910 108.250 1.909
201909 2.040 108.577 2.032
201912 1.990 108.841 1.978
202003 1.770 108.173 1.770

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


Illinois Tool Works  (NYSE:ITW) 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.

Illinois Tool Works's Shiller P/E Ratio of today is calculated as

Shiller PE Ratio=Share Price/E10
=176.96/6.03
=29.35

* 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 Illinois Tool Works was 37.42. The lowest was 16.31. And the median was 23.84.


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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