Neither Robert J. Shiller nor any affiliates or consultants, are registered investment advisers and do not guarantee the accuracy or completeness of the CAPE Ratio here, or any data or methodology either included therein or upon which it is based. PE (Price-Earnings-Ratio), PC (Price-Cashflow-Ratio), PS (Price-Sales-Ratio) and DY (Dividend-Yield) are based on trailing 12 month values. PB (Price-Book-Ratio) is based on the most recent company financal statements.
The Shiller P/E ratio is computed by taking the current price and dividing by the average inflation-adjusted earnings from the previous 10 years. Stock price data are monthly averages of daily closing prices through January 2000, the last month available as this book goes to press. "Weight" provides the actual country weight. The price-earnings ratio, also known as P/E ratio, P/E, or PER, is the ratio of a company's share (stock) price to the company's earnings per share.The ratio is used for valuing companies and to find out whether they are overvalued or undervalued. P/E 10 Ratio: The P/E 10 ratio is a valuation measure, generally applied to broad equity indices, that uses real per-share earnings over a 10-year period. The presented valuation ratios are market-capitalization-weighted. The data and CAPE Ratio on this spreadsheet were developed by Robert J. Shiller using various public sources. The CPI-U (Consumer Price Index-All Urban Consumers) published by the U.S. Bureau of Labor Statistics begins in 1913; for years before 1913 1 spliced to the CPI Warren and Pearson's price index, by multiplying it by the ratio of the indexes in January 1913. Prof. Robert Shiller of Yale University invented the Schiller P/E to measure the market's valuation. The cyclically adjusted price-to-earnings ratio, commonly known as CAPE, Shiller P/E, or P/E 10 ratio, is a valuation measure usually applied to the US S&P 500 equity market. The Schiller P/E is a more reasonable market valuation indicator than the P/E ratio because it eliminates fluctuation of the ratio caused by the variation of profit margins during business cycles.