How should the WTM historical PE ratio be determined?
Realizing that PE stands for Price to Earnings ratio, we need two values to compute it: stock price and earnings per share. The stock price at any given date is a known historical value, but what about the earnings number to use?
✔️Accepted answer:
There are a number of different approaches when it comes to calculating a historical PE ratio for a company like White Mountains Insurance. We like to take our measurements on each of the past quarterly earnings reports. That only leaves the question of whether the earnings number at that quarterly report should be used on an annualized basis, or some other method. We approach this question using three different methods, on this WTM Historical PE Ratio page.
What is the average historical PE for WTM based on annualized quarterly earnings?
As we look back through earnings history, what is the resulting PE calculation if at each measurement period we use that quarter's earnings result annualized?
✔️Accepted answer:
The WTM historical PE ratio using the annualized quarterly earnings method works out to 32.5.
What is the average historical PE for WTM based on trailing twelve month earnings?
As we look back through earnings history, what is the resulting PE calculation if at each measurement period we use the trailing twelve months combined earnings result in the calculation?
✔️Accepted answer:
The WTM historical PE ratio using the TTM earnings method works out to 31.2.
What is the average historical PE for WTM based on median TTM earnings?
As we look back through earnings history, what is the resulting PE calculation if at each measurement period we use the median earnings over the trailing twelve months and annualize that median result in the calculation?
✔️Accepted answer:
The WTM historical PE ratio using the annualized median TTM earnings method works out to 203.04.
On this page we presented the
WTM Historical PE Ratio information for White Mountains Insurance' stock.
The average WTM historical PE based on using the annualized quarterly earnings result at each measurement period (for the "E" in the PE calculation; and the closing price on earnings date as the "P") is 32.5. Meanwhile, using the trailing twelve month (TTM) quarterly earnings result as our method of calculation the "E" value at each measurement period, the average WTM historical PE based on this TTM earnings result method is 31.2. Note: any PE calculations involving negative earnings were discarded as not meaningful.
Let's now compare this WTM historical PE result, against the recent PE: when this page was posted on 8/19/2024, the most recent closing price for WTM had been 1791.74, and the most recent quarterly earnings result, annualized, was 369.32. Meanwhile, the most recent TTM earnings summed to 192.15. From these numbers, we calculate the recent WTM PE on 8/19/2024 based on annualized quarterly EPS was 4.9. Based on WTM's history, that recent PE is low relative to the historical average, with the recent PE 84.9% lower than the historical average PE across our data set for White Mountains Insurance. Looking at the recent WTM PE on 8/19/2024 based on TTM EPS, we calculate the ratio at 9.3. Based on WTM's history, that recent PE is low relative to the historical average, with the recent PE 70.2% lower than the average PE across our White Mountains Insurance data set with TTM EPS used in the calculation at each period.
Another interesting WTM historical PE Ratio calculation we look at is to take the
median earnings per share of the last four quarters for WTM, and then annualize the resulting value... with that annualized number then being used in the PE calculation. To walk through this math for WTM, we start with the past four EPS numbers and we first sort them from lowest to highest: -21.24, 9.19, 92.33, and 111.87. We then toss out the highest and lowest result, and then take the average of those two middle numbers — 9.19 and 92.33 — which gives us the median of 50.76. Basically the way to think about this 50.76 number is this: for the trailing four earnings reports, 50.76 marks the "middle ground" number where WTM has reported a value
higher than 50.76 half the time, and has reported a value
lower than 50.76 half the time. Annualizing that median value then gets us to 203.04/share, which we use as the denominator in our next PE calculation. With 1791.74 as the numerator (as of 8/19/2024), the calculation is then 1791.74 / 203.04 =
8.8 as the WTM PE ratio as of 8/19/2024, based on that annualized median value we calculated.
For self directed investors doing their due diligence on WTM or any other given stock, valuation analysis for WTM
can greatly benefit from studying the past earnings and resulting PE calculations. This exercise can help inform an analysis
as to whether the past earnings trajectory and current versus historical PE ratios justify the current stock value.
That's why we bring you
HistoricalPERatio.com to make it easy for investors to investigate
White Mountains Insurance PE history or the past PE information for any stock in our coverage universe.
And in your continued research we hope you will be sure to check out the further links included for earnings
surprises history (beat/miss data) as well as next earnings dates for WTM. Thanks for visiting, and the next
time you need to research
WTM Historical PE Ratio or the ratio for another stock, we hope you'll think of our site, as your
go-to historical PE ratio research resource of choice.